The tax concessions for IT companies will be extended for a five-year period, until 2021, IPN reports, quoting a bill proposed by the Ministry of Information and Communication Technology for public debates.

Now the companies that analyze, design and program information systems and prepare for utilization and produce software by order of beneficiaries are offered particular tax concessions. These include the maintaining of the fixed social insurance contributions paid by the employer at the level of two average salaries projected for each year and payment of an income tax rate of 12%, as the companies from the whole economy pay.

The Ministry said that when using these concessions and fully exempting the IT companies from paying the income tax in 2005-2011, the IT exports rose from US$4 million to US$71 million. In the period, a number of international IT companies entered the Moldovan market, such as Cedacri (Italy), Tehnosoft (the Netherlands) and Gilat (Israel), which employ local specialists and pay competitive salaries, contributing to the development of the local IT market.

The given tax concessions expire in 2016. The Ministry considers the competitiveness in this sector and the IT services on the local market can now diminish and the IT specialists will migrate to countries where the salaries are much higher.