The State grants a lot of incentives (especially tax incentives) to investment projects, and businesses doing business in the fields, industries and regions are entitled to investment incentives.
Below, the DHP Law briefly introduces tax incentives for businesses in accordance with current laws:
- LEGAL BASIS:
- Investment Law 2014;
- Decree No. 118/2015/ND-CP detailing and guiding the implementation of a number of articles of the Investment Law;
- Law on corporate income tax as amended 2013;
- Law on export tax and import tax 2016;
- Decree No. 134/2016/ND-CP detailing a number of articles and measures to implement the law on import and export tax;
- Law on non-agricultural land use tax 2010;
- Circular No. 83/2016/TT-BTC guiding the implementation of investment incentives in accordance with the provisions of the Investment Law and Decree No. 118/2015/ND-CP dated November 12, 2015 of the Government detailing and guiding the implementation of a number of articles of the Investment Law;
- Decree No. 57/2018/ND-CP on mechanisms and policies to encourage enterprises to invest in agriculture and rural areas.
- CONTENT
- Forms of preferential application
- Apply the corporate income tax rate lower than the normal tax rate for a definite term or for the entire duration of the investment project; exemption and reduction of corporate income tax;
- Exemption from import tax on goods imported to create fixed assets; raw materials, supplies and components for the implementation of investment projects;
- Exemption and reduction of land rent, land use levy and land use tax.
- Objects entitled to investment incentives:
Enterprises investing in projects in the fields, areas, etc., have investment incentives as follows:
2.1. Incentives for investment projects in the field of investment incentives, including:
- Investing in the business of product distribution chains of small and medium-sized enterprises; business investment in technical facilities to support small and medium-sized enterprises, small and medium-sized business incubators; invest in business in the co-working space to support small and medium-sized enterprises to start and innovate according to the provisions of the law on supporting small and medium-sized enterprises;
- High-tech activities, high-tech supporting industrial products; research and development activities;
- Producing new materials, new energy, clean energy, renewable energy; produce products with added value of 30% or more, energy-saving products;
- Producing electronic products, key mechanical products, agricultural machines, automobiles, auto parts; shipbuilding;
- Producing supporting industrial products for the textile, garment, leather and footwear industries and products specified at Point c of this Clause;
- Producing information technology products, software, digital content;
- Cultivation and processing of agricultural, forestry and aquatic products; planting and protecting forests; making salt; fishing and fisheries logistics services; production of plant varieties, animal breeds and biotechnology products;
- Collect, treat, recycle or reuse waste;
- Investment in development, operation and management of infrastructure works; develop public passenger transport in urban areas;
- Pre-school education, general education, vocational education;
- Medical examination and treatment; production of drugs, medicinal ingredients, key drugs, essential drugs, drugs for the prevention and control of social diseases, vaccines, medical biological products, drugs from herbal ingredients, traditional medicines; scientific research on preparation technology and biotechnology for the production of new drugs;
- Investing in physical training and sports facilities for people with disabilities or professionals; protect and promote the value of cultural heritage;
- Investing in geriatric and psychiatric centers, treating patients infected with Agent Orange; centers for the elderly, disabled, orphans and homeless children;
- People’s credit funds, microfinance institutions.
2.2. Investment projects in investment incentive areas, including:
- Areas with difficult socio-economic conditions, areas with extremely difficult socio-economic conditions;
- Industrial parks, export processing zones, high-tech zones, economic zones.
2.3. Incentives for investment projects with a capital scale of VND 6,000 billion or more, disbursing at least VND 6,000 billion within 3 years from the date of issuance of the investment registration certificate or decision on investment policy. private;
2.4. Incentives for investment projects in rural areas employing 500 employees or more;
2.5 . Incentives for high-tech enterprises, science and technology enterprises, science and technology organizations.
2.6. Incentives for projects on agriculture and other projects as prescribed by the Government from time to time.
III. Investment incentive policies
3.1. Corporate income tax incentives
- Enjoy the preferential corporate income tax rate of 10%-20% for a period of 10-15 years, depending on each investment project; or
- Tax exemption for four years, 50% reduction of tax payable in the next 4-9 years, depending on each investment project.
3.2. Import tax incentives
- To be exempt from tax on goods imported to create fixed assets of beneficiaries of investment incentives;
- To be exempted from import tax on raw materials, supplies and components that cannot be domestically produced and imported for production of investment projects on the list of industries and trades with special investment incentives or geographical areas with favorable business conditions. especially difficult socio-economic conditions according to the provisions of the law on investment, high-tech enterprises, science and technology enterprises, science and technology organizations within 5 years from the date of commencement of production. export .
3.3. Preferential land rent, land use fee, land use tax
- 50% reduction of payable non-agricultural land use tax; or
- Exemption from non-agricultural land use tax;
- Exemption and reduction of land use fees; or
- Exemption of land rent and water surface rent for the first 11-15 years from the date on which the State leases land or water surface and reduces land and water surface rent by 50% for the next 05-07 years; or
- Exemption from land rent and water surface rent; or
- Apply the preferential land prices set by the People’s Committees of the provinces and centrally-run cities and remain stable for at least 5 years.
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