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New limits on public aid

Company: EY

The Ministry of Industry and Trade has prepared an amendment to the Government Regulation on the permissible level of public aid in the cohesion regions of the Czech Republic. The amendment responds to the amendment of the European Block Exemption Regulation, which is effective from 1 July 2023.

Regional investment aid must not exceed the permitted level of public aid, which in the Czech Republic currently ranges between 20% and 40% for large enterprises (except in Prague, where regional investment aid is not granted). The regional investment aid scheme includes e.g. investment incentives. In the case of large investment projects, the allowable rate of public aid is halved for the part of eligible costs exceeding EUR 50 million and not exceeding EUR 100 million. Eligible costs exceeding EUR 100 million can only be supported on the basis of an individual notification to the European Commission. These thresholds should be increased from EUR 50 million to EUR 55 million and from EUR 100 million to EUR 110 million. The change in the thresholds responds to the increase in inflation across the European Union. The amended government regulation is expected to take effect from 1 January 2024.

If you have any questions on this topic, please contact the authors of this article or the EY advisory team you usually work with.


Martin Hladký

Veronika Kruttová

Tags: Finance | Taxes & Accounting |

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