Tax incentives are the concessions in tax codes that mean a conscious loss of government budgetary revenue because they reduce either the tax base (tax allowance) or the tax due (tax credit). Concerning tax incentives for the purposes of corporate income tax, countries typically regard company expenditure on training as a business cost which is 100% deductible from the taxable income. Thus, training expenditure is considered as cost incurred by the economic process and treated on equal footing with other costs such as costs for material or merchandise, rents, wages, etc.

In some countries, companies may also receive additional tax incentives related to their training activities. For example, Austria allows employers to deduct more than 100% of training costs, thus provides a real incentive.

Tax incentives can be used to encourage training in companies in general or they can be targeted at specific types of training or companies, e.g. training for entrepreneurs or SMEs.