There are many reasons for choosing Carinthia as business location. They include grants, infrastructure for research and development and a qualified and skilled workforce in the technical and commercial sectors.
With its favourable geographical position in the heart of the Alps-Adriatic region, Carinthia is interesting as it can open the door to the growth markets in Southern and South-East Europe, and it also is close enough to the key markets of Central and Western Europe.
The continuous expansion of the infrastucture combined with a stable and secure economic environment makes Carinthia a highly attractive business location.
Research and development
Carinthia has enjoyed dynamic economic growth in recent years, also thanks to the numerous innovations and research achievements of the companies and research facilities located here. They have, in turn, been helped by the targeted establishment of research facilities in Carinthia‘s segments of particular economic strength and by introducing companies to research facilities and specialized competence centers.
Top R&D rate
Carinthia has boosted its research rate by over 25 percent since 2002. The strongest rate of growth in Austria. With R&D as a percentage of GPD at 2.43 percent, Carinthia occupies the number three slot in Austria.
Carinthia’s research facilities and centers of competence
CTR – Carinthian Tech Research: Centre of competence for intelligent sensor technology
- Research about: optical systems technology, photonic microsystems technology, SAW (Surface Acoustic Wave) sensor systems, photovoltaic modules
KAI – Centre of competence for automotive and industrial electronics
- Research about: high temperature electronics, electronic components for the automotive industry
W3C – Wood Carinthian Competence Center
- Research about: surface technologies, process optimization, spectroscopic applications, production and logistics in the wood industry
Lakeside Labs – platform for information and communication technology
- Research about: mobile telephony, multimedia technologies, signals processing, “self-organizing networked systems”
Another key area of activity is in the company-owned R&D facilities of Carinthian enterprises. In recent years the Carinthian subsidiaries of multinational corporations have repeatedly been awarded the internal contract for the establishment of an R&D centre at the Carinthian location.
Carinthia can offer interesting subsidy opportunities to both domestic and foreign businesses for – amongst others – investments in industry, tourism-related projects and research and development undertakings:
- investment subsidies of up to 35 percent
- subsidies for R&D of up to 60 percent
- further subsidy possibilities (e.g. training and further education programs)
One of the strengths of Austria as a business location is its business-friendly tax system:
- uniform taxation of profits at 25%;
- no trade tax;
- no gift duty or inheritance tax.
Modern group taxation
The group taxation which makes Austria interesting for internationally active companies is unique in Europe. When several companies combine to form a group of companies, the taxable results of the Austrian members of the group are attributed to the respective parent company and ultimately taxed on an offset basis at the level of the group parent company. This means that tax losses of individual group companies can immediately be set off against the tax profits of other group companies.
A tax-effective research allowance can be claimed for expenditure on the “development or improvement of inventions with macroeconomic value” in the year in which this is incurred. This allowance is strictly 25% of the research expenditure, meaning that 125% of research expenditure can be claimed to reduce profits. An increased allowance of 35% can be applied if research expenditure exceeds the average over the last three years.
The training allowance for direct expenditure on training and retraining employees is 20%.
Individual income is subject to a progressive tax rate between 0% and 50%.
Author: EMILIO MENEGHELLA