The incentives and tax exemptions granted to investors in the bill on investment promotion, debated in the Lower House, seek wealth generation and job creation, Minister of Industry and Mines Abdessalam Bouchouareb said Tuesday.
The minister was answering MPs questions, following the discussions of the investment bill, in a Lower House session chaired by Speaker Mohamed Larbi Ould Khelifa and attended by Minister of Relations with Parliament, Ghania Eddalia.
Bouchouareb said that tax incentives “will not affect the public treasury” and will rather allow “diversifying the economy, creating wealth and jobs and expanding the tax base. “
He added that the State recovered 70% of tax expenditures, during the execution of the projects.
In the moment when the country looks for new sources of funding “we must choose between the tax on corporate profits (Among the incentives) and the priorities which are namely the establishment of wealth and jobs job.”
On some MPs comments dubbing “disproportionate” the benefits and tax exemptions in the Bill, Bouchouareb said that on the contrary “the exemptions were reduced,” adding that those benefits “will not be granted anarchically ” as it was the case before.
The investment code cannot be the only solution to all the problems of the national economy, he said, stressing the need to improve the business climate, through the fight against bureaucracy, the guarantee of industrial land and funding in order to boost investment in Algeria.
Bouchouareb said, moreover, that there will be no change for pre-emptive right, but the bill aims at adapting to the international rules in force.
Concerning the 51/49 rule governing foreign investment, he said that the Bill proposes its removal from Investment Code to be governed by the Finance Act, recalling that this rule was introduced by the Finance Act 2016.
The Minister assured that in the current economic situation, “the cancellation of this rules will not benefit the country.”
Responding to some deputies’ questions on the lack of a clear vision of investment, the minister said that the State defines 15 priority sectors which have contributions ranging between 26 and 30 billion dollars.
He announced the signing, on 20 June of agreements on phosphate production projects in Tébessa, Souk Ahras and in Hadjar Soud (Skikda).
These investments will help increase domestic phosphate production which is expected to rise from 1 million tons currently to 10 million tons by the end 2019, which will make Algeria one of the first producers of different types of fertilizers.