Which entities are eligible for investment incentives in Vietnam? What are forms of investment incentives in Vietnam?

Which entities are eligible for investment incentives in Vietnam?

Pursuant to Clause 2 Article 15 of the Law on Investment in 2020 stipulating forms and objects for application of investment incentives:

Forms and objects for application of investment incentives

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2. Entities eligible for investment incentives:

a) Investment projects in business lines eligible for investment incentives specified in Clause 1 Article 16 of this Law;

b) Investment projects located in the areas eligible for investment incentives specified in Clause 2 Article 16 of this Law;

c) Any investment project whose capital is at least VND 6,000 billion of which at least VND 6,000 billion is disbursed within 03 years from the issuance date of the investment registration certificate or the approval for investment guidelines and which satisfies any of the following criteria: the total revenue is at least VND 10,000 billion per year within 03 years from the year in which the revenue is earned or the project has more than 3,000 employees;

d) Projects on investment in social housing construction; investment projects located in rural areas and employing at least 500 employees; investment projects that employ persons with disabilities in accordance with regulations of law on persons with disabilities.

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As regulated above, following entities are eligible for investment incentives:

- Investment projects in business lines eligible for investment incentives;

- Investment projects located in the areas eligible for investment incentives;

- Any investment project whose capital is at least VND 6,000 billion of which at least VND 6,000 billion is disbursed within 03 years from the issuance date of the investment registration certificate or the approval for investment guidelines and which satisfies any of the following criteria: the total revenue is at least VND 10,000 billion per year within 03 years from the year in which the revenue is earned or the project has more than 3,000 employees;

- Projects on investment in social housing construction; investment projects located in rural areas and employing at least 500 employees; investment projects that employ persons with disabilities in accordance with regulations of law on persons with disabilities.

- Hi-tech enterprises, science and technology enterprises and science and technology organizations;

- Projects involving transfer of technologies on the List of technologies the transfer of which is encouraged in accordance with regulations of the Law on Technology Transfer;

- Science and technology enterprise incubators prescribed by the Law on High Technologies and Law on Science and Technology;

- Enterprises manufacturing and providing technologies, equipment, products and services with a view to satisfaction of environment protection requirements prescribed by the Law on Environment Protection;

- Start-up projects, national innovation centers and research and development centers;

- Investment in business in small and medium-sized enterprises’ product distribution chain;

- Investment in business in technical establishments supporting small and medium-sized enterprises, small and medium-sized enterprise incubators;

- Investment in business in co-working spaces serving small and medium-sized enterprises and startups prescribed by the Law on Small and Medium-Sized Enterprises.

Which entities are eligible for investment incentives in Vietnam? What are forms of investment incentives in Vietnam? - image from internet

Which business lines are eligible for investment incentives in Vietnam?

Pursuant to Clause 1 Article 16 of the Law on Investment in 2020 (amended by Clause 3.a Article 84 of the Law on Water Resources in 2023), following business lines are eligible for investment incentives:

- Hi-tech activities, hi-tech supporting industry products, research, manufacturing and development of products formed from science and technology results in accordance with regulations of law on science and technology;

- Manufacturing of new materials, new energy, clean energy, renewable energy; manufacturing of products with an added value of 30% or more; energy-saving products;

- Manufacturing of key electronics, mechanical products, agricultural machinery, automobiles, automobile parts; shipbuilding;

- Manufacturing of products on the List of prioritized supporting industry products;

- Manufacturing of IT products, software products, digital contents;

- Breeding, growing and processing of agriculture products, forestry products, aquaculture products; afforestation and forest protection; salt production; fishing and fishing logistics services; production of plant varieties, animal breeds and biotechnology products;

- Collection, treatment, recycling or re-use of waste; development and storage of water and restoration of water sources;

- Investment in development, operation, management of infrastructural works; development of public transportation in urban areas;

- Pre-school education, general education, vocational education, higher education;

- Medical examination and treatment; manufacturing of medicinal products and medicinal materials, storage of medicinal products; scientific research into preparation technology and biotechnology serving creation of new medicinal products; manufacturing of medical equipment;

- Investment in sports facilities for the disabled or professional athletes; protection and promotion of value of cultural heritage;

- Investment in geriatric centers, mental health centers, treatment for agent orange patients; care centers for the elderly, the disabled, orphans, street children;

- People's credit funds, microfinance institutions;

- Manufacturing of goods and provision of services that create or participate in value chains and industry linkage clusters.

What are forms of investment incentives in Vietnam?

Pursuant to Clause 1 Article 15 of the Law on Investment in 2020 stipulating forms of investment incentives in Vietnam:

- Corporate income tax incentives, including application of a lower rate of corporate income tax for a certain period of time or throughout the investment project execution; exemption from and reduction of tax and other incentives prescribed by the Law on Corporate Income Tax.

- Exemption from import tax on goods imported to form fixed assets; raw materials, supplies and components for manufacturing purposes in accordance with regulations of law on import and export tax;

- Exemption from and reduction of land levy and land rents;

- Accelerated depreciation, increasing the deductible expenses upon calculation of taxable income.

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