Committee approves amendments to Investment Law

Lower House
(File photo: Jordan News)
AMMAN — A Lower House committee and the government’s economic team approved amendments to a 2022 draft bill, which will regulate the investment environment in Jordan. اضافة اعلان

Saturday’s approval sets the stage for the amended draft to be returned to the full 130-seat Lower House of Parliament for endorsement.

Here are some highlights on the changes.

Article 9: The Council of Ministers, upon the recommendation of the Incentives and Exemptions Committee, will issue a schedule that includes fixed assets, production requirements and inputs, and spare parts necessary for the exercise of economic activity subject to tax at zero percent in the regions that the law specifies.

Article 10: Despite what was stated in the income tax law, there will be an exemption from the income tax by no less than 30 percent on economic activities in the less developed regions in the Kingdom, or projects that employ at least 250 Jordanians, which will be applicable for a maximum period of five years from the date of actual operation.

The committee also approved an article about providing a comprehensive investment service for licensing economic activities and completing related transactions. Additionally, the committee added a progressive text prohibiting any official entity from asking the investor to submit a valid document issued by another official entity, in case both were linked electronically.

The committee also reformulated the draft investment map in the Kingdom, which the Ministry of Investment will undertake the task of carrying out, to become as follows: Preparing the draft investment map for the Kingdom according to sectors and governorates that identify available investment opportunities, including partnership projects with the private sector, in coordination and cooperation with the concerned authorities, provided that the update is carried out continuously.

The incentives and exemptions committee is formed by the Council of Ministers, among its members, provided that it includes in its membership the ministers of investment, planning, international cooperation, industry, trade, supply, and finance. The committee added a text prohibiting any member of the incentives and exemptions committee from participating in making any decision related to economic activity, investment fund, or joint investment fund s in which he and his spouses or relatives - up to the second degree - obtain a direct or indirect benefit. Furthermore, each of them must disclose any benefits that may accrue under penalty of legal liability.

It also approved the article that allows the Council of Ministers, upon the recommendation of the Incentives and Exemptions Committee, to adopt any incentives, advantages, or exemptions for economic activities in any region of the Kingdom. It will include exemptions and incentives related to the price of the sale or rent allowance for lands owned by the public treasury to establish economic activities. In addition, it called for supporting the costs of energy and water, renewable energy projects, and allowing investors to deduct the costs of installing infrastructural services that they have connected to the economic activity from the receivables, in case the project is operated within a certain period and granting tax or customs exemptions or reductions in return for employing a minimum number of Jordanian workers.

The committee added a text specifying the criteria that must be taken into account in granting incentives and benefits in a way that does not affect fair competition: Employing not less than 350 Jordanians, of them 50 are Jordanian women. Also, in economic activities targeting export markets, an investor must employ 50 percent of women in the workforce besides hiring women at the local value activities with a percentage of not less than 50 in activities aimed at transferring knowledge and technology, digital transformation, strategic economic activities, and activities included in public-private partnership projects.

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