4 principles for applying special investment incentives

In addition to the provisions in Clause 6, Article 20 Decree No. 31/2021/ND-CP, special investment incentives and support are also implemented according to the following principles:

1. Applicable to new investment projects and expansion investments.

2. Special investment incentives are specified in the Investment Registration Certificate, Investment Policy Approval Decision/written agreement with State agencies.

3. During the period of enjoying special investment incentives, any economic organization that meets the conditions for actual incentives will enjoy incentives at that level for the remaining incentive period.

The remaining incentive period is determined by the incentive period according to the actual incentive conditions minus the corresponding number of years of corporate income tax exemption or reduction, the number of years of applying corporate income tax preferential tax rates, and the number of years of tax exemption and reduction. Land lease and water surface lease have been applied before.

4. If you do not comply with the commitments and conditions for applying special investment incentives:

- If you have not yet enjoyed special investment incentives, you will no longer be able to enjoy them;

- If you have declared to enjoy special investment incentives but in fact do not meet the conditions, you will not be entitled to receive them. At the same time, you must declare and pay the amount of incentives for the years that do not meet the preferential conditions (if yes) and the amount of late payment and fines for violations according to regulations.

Tax rates and duration of corporate income tax incentives

Based on the Article 5 and Article 6 of Decision No. 29/2021/QD-TTg of the Prime Minister, the incentive levels and duration of corporate income tax incentives are as follows:

1- Preferential tax rate of 9% for 30 years For income of economic organizations from implementing investment projects in industries and professions with special investment incentives with capital of 30,000 billion VND or more, disbursement of at least 10,000 billion VND within 03 years from the date of approval. Issue Investment Registration Certificate/Investment Policy Approval.

At the same time, tax exemption for 5 years, 50% reduction of tax payable for the next 10 years.

2- Preferential tax rate of 7% for 33 years for income from investment projects in one of the following cases:

+ Newly established investment projects (including the expansion of that newly established project) of innovation centers, research and development centers with a total investment capital of VND 3,000 billion or more, actually currently disburse a minimum of VND 1,000 billion within 03 years from the date of issuance of the Investment Registration Certificate or Investment Policy Approval Decision.

+ Investment projects eligible for special incentives and meeting 01 of 04 criteria: Is a level 1 high-tech project; There are Vietnamese enterprises participating in the level 1 chain; Added value accounts for over 30% - 40% of the total cost of the final output product; Meets level 1 technology transfer criteria.

In addition, there will be a 6-year tax exemption and a 50% reduction in tax payable for the next 12 years.

3- Preferential tax rate of 5% for 37 years for income from activities of subjects or investment projects in one of the following cases:

+ The National Innovation Center was established by decision of the Prime Minister.

+ The investment project is eligible for special investment incentives and meets one of the following criteria: Is a level 2 high-tech project; There are Vietnamese enterprises participating in the level 2 chain; Added value accounts for over 40% of the total cost of the final output product; Meets level 2 technology transfer criteria.

In addition to tax incentives, economic entities/organizations implementing investment projects in this case will also receive a 6-year tax exemption and a 50% reduction in tax payable for the next 13 years.