HÃNG LUẬT DHP

1. Legal basis:

Law on Corporate Income Tax 2008;

Law on corporate income tax amended in 2013;

Law amending and supplementing a number of articles of tax laws in 2014;

Decree 218/2013/ND-CP guiding the implementation of the Law on corporate income tax;

Decree 91/2014/ND-CP amending Decrees on tax regulations;

Decree No. 12/2015/ND-CP guiding the Law amending and supplementing a number of articles of the Law on Taxation and amending and supplementing a number of articles of the Decrees on Taxation;

1. Regulations on tax incentives:

1. Regulation summary:

Tax incentives mean that businesses get:

+ Apply a lower tax rate than the general tax rate (the current general tax rate is 22% for enterprises with a turnover of less than VND 20 billion/year, 22% for enterprises with a turnover of VND 20 billion/year). above);

+ Tax reduction or exemption for a certain period of time.

CIT incentives apply to 3 cases:

+ Incentives according to the area of investment, production and business of the enterprise;

+ Incentives according to the field of production and business of the enterprise;

+ Incentives due to specific labor use and technology transfer;

2. Contents of incentives in accordance with current law:

Incentives according to the area of investment, production and business

+ Apply the tax rate of 10% for a period of 15 years, tax exemption for 4 years, and 50% reduction of payable tax for the next 9 years, applicable to enterprises having new investment projects in geographical areas with favorable economic conditions. – extremely difficult society specified in the Appendix (attached);

+ Applying tax rate of 17% for ten years, Tax exemption for 2 years and reduction of 50% of payable tax for the next 4 years, applicable to enterprises having new investment projects in geographical areas with favorable economic conditions. – difficult society specified in the Appendix (attached).

Note: For local incentives, incentives are only available when the enterprise has a licensed investment project.

Incentives by business sector:

+ Apply the tax rate of 10% for a period of 15 years, tax exemption for 4 years, and 50% reduction of payable tax for the next 9 years.

+ Having investment projects in economic zones, high-tech zones, including concentrated information technology zones, established under the Prime Minister’s Decision.

+ Having new investment projects in the following fields: Scientific research and technological development; high technology applications on the list of high technologies prioritized for development investment in accordance with the Law on High Technology; high-tech incubation, high-tech enterprise incubation; venture capital investment in the development of high technologies on the list of high technologies prioritized for development in accordance with the law on high technology; investment in construction and business of hi-tech incubators, hi-tech enterprise incubation; invest in the development of water plants, power plants, water supply and drainage systems; bridge, road, railway; airport, seaport, river port; airports, railway stations and other particularly important infrastructure works decided by the Prime Minister; software product production; production of composite materials, all kinds of light construction materials, rare and precious materials; produce renewable energy, clean energy, energy from waste destruction; biotechnology development.

+ New investment projects in the field of environmental protection, including: Manufacture of equipment for treatment of environmental pollution, equipment for environmental monitoring and analysis; pollution treatment and environmental protection; collection and treatment of wastewater, exhaust gas and solid waste; waste recycling and reuse;

+ High-tech enterprises and hi-tech agricultural enterprises;

+ Incomes of enterprises from implementing new investment projects in the field of production (except for projects of producing goods subject to excise tax, mining projects) that satisfy either of the following two criteria:

+ The project has an investment capital of at least 6 (six) trillion dong, disbursed within 3 years from the time of first investment in accordance with the law on investment and has a total turnover of minimum revenue of 10 (ten) trillion dong/year at the latest after 3 years from the year of revenue.

+ Projects with minimum investment capital of 6 (six) trillion dong, disbursed within 3 years from the time of first investment is permitted in accordance with the law on investment and common use. more than 3,000 employees at the latest after 3 years from the year of revenue

• Implementation of investment projects in the field of production, excluding projects to produce goods subject to excise tax and mining projects, with an investment capital of at least 12,000 (twelve thousand) billion dong; Using technology must be appraised in accordance with the provisions of the Law on High Technology, Law on Science and Technology, disbursed the total registered investment capital within 5 years from the date of investment permit in accordance with the provisions of law. investment law.
• Incomes of enterprises from implementing new investment projects to produce products on the list of supporting industry products prioritized for development that meet one of the following criteria:

+ Industrial products supporting high technology according to the provisions of the Law on High Technology;

+ Industrial products to support the production of products of the following industries: Textile – Garment; leather – shoes; electronics and information technology; automobile production and assembly; mechanical engineering, which as of January 1, 2015 cannot be produced domestically or can be produced but must meet technical standards of the European Union (EU) or equivalent.

• The tax rate of 10% applies to the following incomes:

• Income of the enterprise from performing socialization activities in the fields of education – training, vocational training, health care, culture, sports, environment, judicial assessment;
• Income from publishing activities of a Publisher in accordance with the Law on Publishing
• Income from printing press activities (including advertising on printed newspapers) of press agencies according to the provisions of the Press Law
• Incomes of enterprises from implementing investment projects – social housing business for sale, lease, lease purchase for the subjects specified in Article 53 of the Law on Housing.
• Income of enterprises from: Planting, tending and protecting forests; income from cultivation, animal husbandry, farming and processing of agricultural and aquatic products in areas with difficult socio-economic conditions; to cultivate forest products in areas with difficult socio-economic conditions; production, multiplication and crossbreeding of plant and animal varieties; salt production, extraction and refining, except for salt production specified in Clause 1, Article 4 of this Decree; investment in post-harvest preservation of agricultural products, preservation of agricultural products, aquatic products and food, including investment in direct preservation or investment in leasing to preserve agricultural products, aquatic products and food.
• Cooperatives operating in the fields of agriculture, forestry, fishery and salt production are not located in difficult socio-economic areas and in extremely difficult socio-economic areas mentioned in the Appendix (attached). .
  • The tax rate of 15% shall be applied to incomes of enterprises engaged in cultivation, husbandry and processing in the field of agriculture and fishery located in areas that are not located in areas with difficult socio-economic conditions or in areas with difficult socio-economic conditions. extremely difficult socio-economic conditions mentioned in the Appendix (attached).
  • Apply the tax rate of 20% (from January 1, 2016 to 17%) and exempt from tax for 2 years and reduce 50% of payable tax for the next 4 years within a ten-year period.

Income of enterprises from implementing new investment projects: Producing high-grade steel; produce energy-saving products; manufacturing machinery and equipment for agriculture, forestry, fishery and salt production; production of irrigation equipment; producing and refining animal, poultry and aquatic feed; develop traditional professions;

• The tax rate of 20% is applied to people’s credit funds and microfinance institutions and from January 1, 2016 the tax rate is 17%.
• Tax exemption for 4 years, 50% reduction of payable tax for the next 9 years for:

• Incomes of enterprises from implementing new investment projects in the field of socialization implemented in areas with difficult or extremely difficult socio-economic conditions are specified in the Appendix (attached).
• Tax exemption for 4 years, 50% reduction of payable tax for the next 5 years for enterprises’ incomes from implementing new investment projects in the field of socialization in localities not on the list of conditional geographical areas socio-economic difficulties or special difficulties specified in the Appendix (attached).
• Tax exemption for 2 years and reduction of 50% of payable tax amount for the next 4 years for incomes of enterprises from implementing new investment projects in industrial parks (except for industrial parks located in geographical areas with favorable conditions). – favorable socio-economic conditions).

Tax incentives due to specific employers:

Manufacturing, construction and transportation enterprises employ from 10 to 100 female employees, of which the number of female employees accounts for more than 50% of the total number of employees who are regularly present or employ more than 100 female employees on a regular basis. female employees accounting for more than 30% of the total number of employees regularly present of the enterprise are entitled to a reduction in corporate income tax equal to the additional expenditure for female employees;

Enterprises employing ethnic minority employees are entitled to a corporate income tax reduction equal to the additional expenditures on ethnic minority employees for vocational training, housing support, social insurance, and insurance. health insurance for ethnic minorities in case they have not been supported by the State according to the prescribed regime.

Enterprises conducting technology transfer in the fields of priority transfer to organizations and individuals located in areas with difficult socio-economic conditions according to the Appendix (attached ) will be entitled to a 50% reduction in tax revenue. Enterprise income is calculated on the part of income from technology transfer.

APPENDIX

LOCALS ENJOYING TAX INCOME

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