Tax relief as a form of aid means that support is not provided by paying out funds, but by reducing the recipient's tax liability. In Slovakia it takes several forms: relief on income tax within investment aid, a super-deduction for research and development expenditure, a deduction supporting sport and culture, or exemptions from local taxes. From the perspective of European Union rules, it constitutes the same advantage as a grant, so the value of the relief is converted into a gross grant equivalent and counted towards the limits for state aid and de minimis aid. The advantage is that the company does not have to go through a call or an evaluation, and draws the benefit automatically upon meeting the statutory conditions. The disadvantage is that the aid only materialises when there is a positive financial result – a loss-making company gets nothing from it.
See also: Super-deduction for research and development, Regional investment aid, Cumulation of aid.
