Investment incentives are one of the policies to help Vietnam develop economically, attracting businesses, especially foreign businesses (Korea, Japan, America, China, Singapore,…) to Vietnam.
Article 15 of the Investment Law 2020, regulations on investment incentives include:
- Corporate income tax incentives, including applying corporate income tax rates lower than normal tax rates for a term or the entire duration of investment project implementation; Tax exemption, tax reduction and other incentives according to the provisions of law on corporate income tax (for example, 2-year exemption, 50% reduction for the next 4 years when investing in new projects in industrial parks, export processing zones and economic zones in Vietnam);
- Exemption from import tax for goods imported to create fixed assets; Raw materials, supplies, and components imported for production according to the provisions of law on export tax and import tax (for example for EP projects in export processing zones in Vietnam);
- Exemption or reduction of land use fees, land rent, land use tax (for example for projects in mountainous areas, poor areas, with difficult economic conditions, helping to develop local infrastructure;
- Accelerated depreciation and increased costs are deductible when calculating taxable income (for example, for projects with high, advanced technology).
Procedures for applying investment incentives, Pursuant to the provisions of Article 17 of the Investment Law 2020, guided by Article 23 of Decree 31/2021/ND-CP, regulations on procedures for applying investment incentives are as follows:
- Decision approving investment policies, Investment registration certificate, Decision approving investors stipulating the form, basis, and conditions for applying investment incentives according to the provisions of Articles 15 and 16 of this Law. Investment Law and Article 19 of this Decree.
- Based on the investment incentive content in the Investment Policy Approval Decision, Investment Registration Certificate, and Investor Approval Decision, the investor shall carry out procedures to enjoy investment incentives at the applicable agency. Apply investment incentives corresponding to each type of incentive.
- Grounds for applying investment incentives to a number of enterprises and investment projects specified in Clause 5, Article 19 of this Decree include:
- For science and technology enterprises, the Science and Technology Enterprise Certificate;
- For agricultural enterprises applying high technology, it is the Certificate of agricultural enterprise applying high technology;
- For high-tech application projects, it is a High-tech application project certificate;
- For supporting industry projects, it is a Certificate of incentives for manufacturing supporting industry products;
- For projects with technology transfer on the List of technologies encouraged for transfer, a Certificate of Technology Transfer Encouraged Transfer is required according to the Prime Minister’s regulations.
- For investment projects not falling into the cases specified in Clauses 2 and 3 of this Article, investors shall base on the subjects enjoying investment incentives specified in Article 19 of this Decree and relevant legal provisions. to self-determine investment incentives and carry out procedures for enjoying investment incentives at the agency applying investment incentives corresponding to each type of incentive.
For details, preferential policies and procedures for opening a business in Vietnam, businesses and investors please contact the lawyers of Inco Minh Anh law firm at email: contact@trustconsulting.vn or lawyer hotline 0982674857 for advice.