ANNOUNCEMENT 19 Dec 2008

In December 2008, the government of Slovakia announced a targeted tax change.

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising

SOURCE



the letter from EU to Slovakia - Brussels, 02.12.2009 C(2009)9312 final - http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=3_N674_2008


Inception date: 01 Jan 2009 | Removal date: open ended
Still in force

Tax or social insurance relief

By notification of 19 December 2008, the Slovak authorities notified their intention to grant aid for a large investment project by Volkswagen Slovakia a.s. ( Volkswagen Slovakia) in Bratislava. The Slovak authorities intend to promote regional development by providing
regional aid of EUR 14 300 000 to Volkswagen Slovakia for an investment project in Bratislava.
 
The Commission concluded that the measure contains state aid and gave the following assessment:
 
"The financial support to Volkswagen Slovakia will be given by the Slovak authorities in the form of a corporate income tax allowance. The support can thus be considered as given by the Member State and through State resources within the meaning of Article 107(1) TFEU. As the aid is granted to a single company, Volkswagen Slovakia, the measure is selective. The financial support given to Volkswagen Slovakia will relieve the company from expenses which it normally would have had to bear itself and therefore the company benefits from an economic advantage over its competitors. The financial support from the Slovak authorities will be given for investments resulting in the production of motor vehicles. Since these products are subject to trade between Member States, the support given is likely to affect trade between Member States. The favoring of Volkswagen Slovakia and its production by the Slovak authorities means that competition is distorted or threatened to be distorted." (par. 26-31 of the letter from EU to Slovakia - Brussels, 02.12.2009 C(2009)9312 final).
 
The Commission has decided, on the basis of the foregoing assessment, that the aid of EUR 14 300 000 in nominal value (i.e. EUR 12 555 495 in discounted value), corresponding to an aid intensity of 4.67% GGE in favour of Volkswagen Slovakia, is compatible with Article 107(3)(c) TFEU.
 
A state measure in the GTA database is assessed solely in terms of the extent to which its implementation affects the extent of discrimination against foreign commercial interests. On this metric, the state aid proposed here is discriminatory.
 

AFFECTED SECTORS