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The Ministry of National Economy and Finance is preparing significant tax breaks aimed at promoting cooperation between large companies and start-ups in the fields of research and technological products.
The measures in the draft mergers and acquisitions bill also include strengthening tax exemptions for patents, providing preferential treatment to venture capitalists and angel investors for investments in start-ups, and new tools to finance mergers between small and medium-sized enterprises.
The focus will be on research and technological products developed primarily by start-ups, with the aim of getting larger companies and investors involved to strengthen these companies and enable them to perform better in the market. The Ministry’s ultimate goal is to create a dynamic ecosystem of such companies in Greece, bringing tangible benefits to the economy.
Current law already provides for tax breaks of 30% to 50% for corporate mergers for a period of nine years. Given the lackluster response, the government was considering extending the scope to mergers of small to large companies, as it currently applies to mergers between SMEs. However, the European Commission objected on competition grounds. Therefore, the new bill’s attention is now focused on collaboration in research and technology projects. Moreover, as Minister Kostis Hatzidakis said at a recent conference on mergers and acquisitions, “innovation and growth are to a large extent interrelated concepts.”
According to sources, the bill’s main provisions provide for tax incentives for joint projects between companies and start-ups and research centers, and also strengthen tax incentives for patents. The 50% reduction limit on taxable income, which applies to investments made by angel investors and also to everyone who invests in Greek start-ups, will be raised from €300,000 to €900,000. New tax regimes will be created for venture capital companies investing in Greek companies, providing them more security. Also, from September, a new NSRF measure will be introduced to subsidize investments by SMEs by 50%.
