Investment Incentives in Vietnam in accordance with Law on Investment 2014
Post date: 28-03-2016
Investment Incentives in Vietnam
1. Forms of application of investment incentives in Vietnam [shall comprise]:
(a) Application of a lower rate of corporate income tax than the normal tax rate for a definite period or for the whole duration of implementation of the investment project; and exemption from and reduction of corporate income tax;
(b) Exemption from import duty in respect of goods imported to form fixed assets; raw materials, supplies and components for implementation of an investment project;
(c) Exemption from and reduction of land rent, land use fees and land use tax.
2. Objects entitled to investment incentives in Vietnam:
(a) Investment projects in the preferential investment industries and trades as follows:
1) High-tech activities, industrial products which support high-tech; and research and development activities;
2) Production of new materials, new energy, clean energy or renewable energy; production of products with an added value of 30% or more, and energy-saving products;
3) Production of electronics, prioritized mechanical products, agricultural machinery, automobiles, automobile parts; and shipbuilding;
4) Production of industrial products which support [production of] garments and textiles or leather products and the products prescribed in paragraph 3) of this clause.
5) Production of products of information technology, software and digital content [products];
6) Breeding, growing and processing agricultural, forestry and aquaculture products; afforestation and protection of forests; salt production; fishing and fishing logistics, creation of plant and animal varieties and production of products of biological technology;
7) Collection, processing, reprocessing or reuse of refuse;
8) Investment in development and operation, and management of infrastructure facilities; and development of public transportation in urban areas;
9) Pre-school education, general education, and vocational education;
10) Medical consultation and treatment; production of medicines, raw materials for production of medicines, principal medicines, essential medicines and medicines for prevention and treatment of social diseases, vaccines, medical biological products, medicines from pharmaceutical materials, oriental medicines; and scientific research in relation to technology of preparation or biological technology for production of new medicines;
11) Investment in facilities for training and competition of sports or physical practice for disabled people or for professional sportsmen; and protection and promotion of the value of cultural heritage;
12) Investment in centres for geriatrics, psychiatry or treatment of patients exposed to Agent Orange, and centres for care of the old, disabled, orphans or street children without support;
13) People”s credit funds, and micro-financial institutions.
(b) Investment projects located in preferential investment geographical areas as follows:
1) Areas with difficult socio-economic conditions; and areas with specially difficult socio-economic conditions;
2) Industrial zones, export processing zones, high-tech zones and economic zones.
(c) Projects with a scale of capital being 6,000 billion Dong or more of which at least 6,000 billion Dong is disbursed for a period of three years from the date of issuance of the IRC or the date of the decision on the investment policy;
(d) Investment projects located in rural areas and employing 500 employees or more;
(dd) High-tech enterprises, and scientific and technological enterprises or organizations.
3. Investment incentives shall apply to new investment projects and expanded investment projects. Specific levels of incentives in respect of each type of investment incentives shall be applicable in accordance with the law on taxation and the law on land.
4. The investment incentives applicable to the objects prescribed in clause 2.(b), (c) and (d) of this article do not apply to investment projects for exploitation of minerals; or for production or business in goods or services subject to special sales tax stipulated by the Law on Special Sales Tax, except for manufacture of automobiles.
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