Incentives for new investments in economic zones and investments in encouraging sectors

Generally, under the laws of Vietnam, tax and other incentives are available for projects satisfying certain requirements. These incentives apply to investment projects investing in specific sectors and in areas with different socio-economic conditions as well as those in high-tech zones and economic zones and investments in sourcing of renewable energy, or waste treatment. There are lists of sectors and localities eligible for investment incentives issued by the Government from time to time.

New investments in areas with different socio-economic conditions and investments in industrial parks and economic zones and investments in sourcing of renewable energy, or waste treatment fall into the list of areas with investment encouragements.

1. Corporate income tax (“CIT”): The CIT preferential rate of 10% for 15 years (as opposed to the standard rate of 20%) shall be available depending on specific investment projects.

The CIT exemption for up to 4 years and CIT reduction of 50% for up to 9 years may also be granted. 

2. Import duties: Import duty exemption is available in cases, among others, goods are imported to form fixed assets of investment projects prescribed under the law, goods are imported for implementing export processing contracts with foreign parties, raw materials and supplies are imported to directly serve the production of software products, and cannot be produced domestically, goods are imported for use in scientific research and technological development, and cannot be produced domestically, goods exempted from import duty or export duty according to a treaty to which the Socialist Republic of Vietnam is a contracting party raw materials, supplies and components imported for export production.

3.  Land rental reduction and exemption: Depending on specific projects, the land rental reductions for up to 15 years may be available. 

For your information, in order to be eligible for any of the above enjoyments, specific incentive mút be clearly provided in the relevant incorporation documents of the company (i.e. Investment Registration Certificate or the Enterprise Registration Certificate).