Why invest in Jordan ?
The Investment Promotion Law No. 16 of 1995 recognizes the benefits that foreign investment will bring to Jordan, and includes provisions that encourage domestic entrepreneurs as will.
Jordan targets the following sectors for favorable tax and customs duty treatment: Industry, Agriculture, Hotels, Hospitals, Maritime transport, Railway, Leisure and Recreational Compounds, Convention and Exhibition Centers. The benefits afforded to investors are considerable.
Freedom from Customs Duties
- Fixed assets are exempted from fees and taxes provided that they are imported into the Kingdom solely for the use of the project. These assets include: the machinery, equipment, and supplies, which are used in the project, including the furniture and equipment for hotels and hospitals.
- Imported spare parts for the project shall be exempted from fees and taxes provided that the value of such spares does not exceed 15% of the value of the fixed assets for which they are required.
- Fixed assets required for the expansion, development or modernization of the project shall be exempted from fees and taxes if such expansion, development or modernization shall result in an increase in the production capacity of the project by not less than 25%.
- Hotel and hospital projects shall be granted exemption from fees and taxes once every seven years for the purchase of furniture and supplies required for modernization and renewal.
- Any increase in the value of fixed assets, which are imported for the project, shall be exempted from fees and taxes if such increase is a result of a rise in the price of such assets in the country of origin, of a rise in the freight charges applicable thereto, or of changes in the exchange rate.
Exemption from Taxes
Corporate income tax rates in Jordan are as follows:
- 15% on mining, industry, hotels and hospitals
- 35% on insurance and financial institutions
- 25% on all other companies
- 0% on agriculture projects
The Kingdom is divided into three development zones: A, B and C. Projects in these zones shall enjoy exemptions, by the following percentages, from income and social services taxes for a period of ten years, starting from the date of commencement of work.
- 25% if the project is in a class A development area.
- 50% if the project is in a class B development area.
- 75% if the project is in a class C development area.
- Jordan Investment Law affords equal treatment to both Jordanian and non-Jordanian investors. The Law allows the non-Jordanian investor to own any project in full or in part, or to engage in any economic activity in the Kingdom, with the exception of some trade and contracting services which require a Jordanian partner.
- Except for participation in public shareholding companies, the investment of the non-Jordanian may not be less than fifty thousand Jordanian Dinars (JD 50.000 or $US 70.000).
- The investor has the right to manage the project in the manner the project in the manner he/she deems appropriate, and through the person(s) chosen by the investor for its management.
- The Non-Jordanian investor shall be entitled to remit abroad without delay, ad in a convertible currency, the invested capital together with any returns and profits accrued, the proceeds of liquidation of the investment or the proceeds of the sale of all or part of the project.
- Non-Jordanian technicians and administrators working in any project may transfer their salaries and remuneration abroad.
- With approval of the investment promotion committee, the investor may re-export the exempted fixed assets.
- With approval of the investment promotion committee, the investor may sell the exempted fixed assets or relinquish them to another investor or project not covered by the provisions of this law after paying the fees and taxes due on such fixed assets.
- Any investor whose investment is guaranteed by his country or by an official agency thereof, may assign to that country or agency any returns on his investment or other compensation to which he is entitled.
- It shall not be permissible to expropriate any project or to subject it to any measures that may lead to expropriation unless such expropriation shall be by way of compulsory purchase for the purpose of the public interest, and in return for just compensation to be paid to the investor. The compensation paid to a non-Jordanian investor in such case shall be in a convertible currency.
- Investment disputes between an investor of foreign capital and Jordanian government agencies shall be settled amicably. If no amicable settlement can be reached within a period not exceeding six months, either party may resort to litigation or may refer the dispute to the International Center for the Settlement of Investment Disputes (ICSID).
The Investment Promotion Law No. 16 of 1995 recognizes the benefits that foreign investment will bring to Jordan, and includes provisions that encourage domestic entrepreneurs as will. Jordan targets the following sectors for favorable tax and customs duty treatment: Industry, Agriculture, Hotels, Hospitals, Maritime transport, Railway, Leisure and Recreational Compounds, Convention and Exhibition Centers. The benefits afforded to investors are considerable.
Source : www.jordan.gov.jo