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Practical Manual of Companies 2022.

Scope of application of the specialities

The increased deduction percentages and other specialties of article 94 of Law 20/1991, only will be applied to the new deduction system established in the Chapter IV of Title VI of the LIS , where is equivalent to the deduction system of article 26 of Law 61/1978, of 27 of December, of the Corporate Tax.

The legal basis for this statement is as follows:

  1. article 94.1 of Law 20/1991 , of June 7, establishes that the General Deduction Regime of article 26 of Law 61/1978, of December 27, will apply increased percentages and deduction limits, as long as the investments are made in the Canary Islands.

  2. The fourth transitional provision of Law 19/1994 , of July 6, modifying the Economic and Fiscal Regime of the Canary Islands, establishes in its first paragraph that in the event of suppression of the General Regime of Investment Deduction regulated by Law 61/1978, of December 27, its future application in the Canary Islands, as long as an equivalent replacement system is not established, will continue to be carried out in accordance with the regulations in force at the time of deletion.

  3. article 26 of Law 61/1978, of December 27 was repealed by Law 43/1995, of 27 December, of the Corporate Tax, which introduced in its place, the deductions to encourage the performance of certain activities in Chapter IV of its Title VI (currently, these deductions are regulated in Chapter IV of Title VI of the LIS).