Investment Incentives

Criteria

Investment incentives are granted to projects investing in encouraged investment sectors and/or areas; projects with investment capital of at least VND 6,000 billion; projects in rural areas with at least 500 employees; high-tech enterprises; or science and technology companies/organizations.

Investment incentives are provided in the following forms:

• Corporate income tax (“CIT”) exemption/reduction, preferential CIT rate;

• Import duty exemption; and

• Reduction/exemption of land rental.

1. CIT incentives

• CIT incentives are granted based on regulated encouraged investment sectors and/or areas. CIT incentives are also expanded to incomes from conducting of large-scale projects, with high revenue or use of many employees;

• CIT incentives are now available to income derived from expanded investment of encouraged investment projects;

• Preferential tax rates: 10% for 15 years, 17% for 10 years or 15%.

• Tax exemption, tax reduction: a tax holiday of up to four (4) years and a 50% tax reduction period up to nine (9) years is available, whichever comes first (First profit making year; or the fourth revenue generation year).

2. Import duty incentives

• Goods temporarily imported, then re-exported, for exhibition purposes if they meet certain requirements;

• Goods imported to form fixed assets of projects which are included in encouraged projects as prescribed, including: machinery and equipment; certain means of transportation raw material and spare parts M&E, and construction materials which cannot be produced in Vietnam;

• Certain goods imported for oil and gas activities;

• Goods temporarily imported (and then re-exported) for carrying out ODA projects;

• Goods (i.e. material, semi-finished products) imported for implementing export processing contract with foreign parties, etc.

3. Land rental incentives