Parliament has revised its Corporate Income Tax (CIT) Law to encourage businesses to invest in socially beneficial projects, allowing specific social responsibility expenditures to be deducted from annual taxable income. Under Article 22.9, companies can now claim deductions for eligible social investments up to one percent of their taxable income, supporting projects in areas such as environmental conservation, social services, cultural preservation, public infrastructure and educational support.
The amended law covers a wide range of activities that directly benefit society. Companies can deduct expenses related to protecting and restoring natural resources, including forests, water sources and wildlife, as well as efforts to reduce pollution and combat desertification. Investments aimed at providing care for elderly, disabled citizens, and children, or creating accessible public spaces such as playgrounds and parks, also qualify under the new provisions. Additionally, expenditures on preserving cultural heritage, supporting libraries and museums, and funding creative arts like music and film production are now tax-deductible.
The amendments encourage businesses to support public infrastructure improvements by investing in the development and maintenance of roads, parks, and public transport systems. Relief funds for disaster recovery are also eligible for deductions, offering companies a tax incentive to aid in the response to natural or unexpected events. In sports, the law provides deductions for contributions toward building sports facilities and supporting Olympic-style competitions, including backing for registered sports associations, athletes, and coaches.
To foster educational advancement, the amendments allow deductions for scholarship programs supporting students in prioritized fields, both in Mongolia and abroad, as well as grants for academic research. Contributions to public health and educational institutions are also included, along with financial support for special government funds that address critical national needs.
The law mandates that government ministries set requirements and standards for each type of eligible activity to ensure accountability and compliance. By incorporating these tax incentives, Mongolia aims to encourage businesses to contribute to the nation’s social development and environmental sustainability, aligning corporate growth with broader societal goals.
