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Sunday, 27 September 2020

Is the government exempting factories from property tax?

Are factories getting the real estate tax break they’ve been hoping for? Industry could be getting a leg up from the government if the Madbouly Cabinet agrees to accept a proposal being drafted by the Trade Ministry and exempt factories from the real estate tax. The statement does not provide further details on the duration and extent of the potential tax cut. The government had granted companies in the industrial and tourism sectors a three-month real estate tax holiday as part of the relief package it rolled out in March to help support the economy.

Businesses have been pushing for the exemption since before the pandemic broke out. In February, government sources told us that state-affiliated factories and some private sector companies in specific sectors could be getting property tax relief. In addition to the temporary exemption, factories enjoy property tax exemption on idle land under amendments to the Real Estate Tax Act signed into law in May. The amendments also grant the cabinet the power to exempt land used by strategic industries and sectors to give them “preferential treatment” in property tax, and exempt land owned by factories from the real estate tax.

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