b) The proportional tax table is applied to taxable income from capital investment, capital transfer, real estate transfer, prizes, royalties, franchise, inheritance and gifts, in which:
- Tax on income from capital investment, royalties and franchise: 5%
- Tax on income from capital transfer: 20%
- Tax on income from stock transfer: 0.1%
4. Value Added Tax (VAT) (Purrsuant to Decree No. 209/2013/ND-CP dated 18/12/2013 by the Government):
a) Corporate is non-taxable if his products are specified as:
- Products from farming and breeding that are produced, caught, sold, or imported and are not processed into other products.
- Goods that cannot be manufactured in Vietnam and must be imported, including machinery, equipment, parts, supplies and specialized vehicles serving scientific research and technological development.
b) 0% tax is applied to exported goods and services; international transport; exported goods and services that are not subject to VAT except for the following cases: Technology transfer, transfer of intellectual property right to abroad, oversea reinsurance, credit extension, capital transfer, derivative financial services; outbound postal and telecommunications services; exported natural resources that are not processed into other products.
c) Other forms of product and service depending on fields of operation shall be applied 5% or 10%tax.
5. Import duty
Goods imported to create fixed assets of investment projects in domains entitled to import duty preferences listed in Appendix I to Decree 87/2010/ND-CP dated 13/8/2010 by the Government detailing a number of articles of the Law on Import Duty and Export Duty which are exempted from import duty, including:
a. Equipment and machinery;
b. Special-use means of transport included in technological lines which cannot be domestically manufactured yet; worker-transporting vehicles including cars of 24 seats or more and waterway crafts;
c. Components, details, knocked down parts, spare parts, fittings, molds and accessories accompanying machinery, equipment and special-use means of transport stated at Points a and b of this Clause for assembly into complete units;
d. Raw materials and supplies which cannot be domestically produced yet, to be used for manufacturing equipment and machinery included in technological lines or for manufacturing components, details, knocked down parts, spare parts, fittings, molds and accessories accompanying equipment and machinery stated at Point a of this Clause for assembly into complete units;
e. Building materials which cannot be domestically produced yet.
g. Plant varieties and animal breeds permitted to be imported for the execution of investment projects in the sectors of agriculture, forestry and fishery.
(Especially for projects that apply high technology import duty shall be exempted for 5 years from the manufactured date for materials, supplies, imported opponents for manufacturing; imported semi-finished products that cannot be manufactured domestically for manufacturing purpose.
6. Favorable projects of building house for workers from IZ and for people with low income in residentials.
a. Land use fee and land rent shall be exempted.
b. VAT rate shall be 5%
c. CIT rate shall be 10% for the corporate incomes that are from execution of projects of investment.
d. Tax from Goods imported to create fixed assets for corporate shall be exempted.
e. Infrastructure investment outside of the project (traffic, electricity, water supply and drainage) shall be supported.
7. Incentive policies for educational, medical, cultural and sport projects.
a. Favorable land use fee, land rent
b. 10% CIT rate is for the whole operating time, tax exemption for 4 years and 50% tax reduction for the next 9 years.
c. Goods imported to create corporate’s fixed assets are exempted from import duty
8. Incentive policies for investments in agriculture and rural areas:
a. Land use fee: Invested projects in agriculture and rural area in Dong Nai that are in the agricultural sector eligible for special investment incentives according to Decree 210/2013/ND-CP dated 19/12/2013 by the Government on encouraging enterprises to invest in agriculture and rural area to receive the following incentives:
- Investor with an agricultural project eligible for investment promotion using land allocated by the State shall be entitled to a reduction of 50 per cent of land use levy payable into the state budget for such project.
- Investors with agricultural projects eligible for investment promotion shall be entitled to exemption of land or water surface rent within first 11 years from the date of completion and commissioning of this project.
b. CIT: Tax rate of 10% is applied to projects of breeding, crossbreeding plants and animals; agricultural products reservation after harvest, agricultural, fisheries and other foods product reservation for the whole operating time.
c. Import duty: Projects of growing and manufacturing agricultural, forest and fishery products; artificially breeding, manufacturing new breeds and seeds are exempted from import duty as considered fixed assets for enterprises formation.
9. On investment support on foreign investors who invested on establishing small and medium scale enterprises in Dong Nai
Foreign investors, who have new investments on establishing small and medium scale enterprises in Dong Nai, if have the agreement with the provincial business unit on establishing project investment application, receive these supports:
- Support on 30% fee of establishing application for investment certification.
- Support on 100% fee of making rubber stamp and tax number.
- Support on 30% fee of establishing application for environmental projection commitment approval, environmental impact evaluation report approval (for newly invested projects which are approved and evaluated in terms of environmental impacts by the provincial People's Committee)
10. Incentive policies and mechanism on supporting industries (Decree No. 111/2015/ND-CP dated 03/11/2015 by the Government)
Supporting products manufacturing projects that are invested in industrial zone’s subdivision (Nhon Trach 6 subdivision, An Phuoc, Giang Dien), receive the following incentives:
a. Corporate income tax:
10% of CIT for 15 years, tax exemption for 4 years and 50% reduction for the next 9 years (as prescribed in Law no. 32/2013/QH13 dated 19/6/2013 by the Congress on modifying the Laws of Corporate Income Tax)
b. Income duty:
Tax from Goods imported to create corporate’s fixed assets shall be exempted (as prescribed in Decree no. 87/2010/ND-CP dated 13/8/2010 by the Government)
c. Market development support:
- Having priority in joining national trade promotion programs
- Receiving support on part of the trademark registration fee, national and international market fair registration fee, fee to approach market information and fee for services from the supporting industries development programs.
d. Research and development support
- Being funded by the Supporting Industries Development Program, official funds, other funding for research, development and training purpose;
- Being considerably supported part of the research and development expenditure by the Supporting Industries Development Program. if the research and development projects are highly effective.
- The State supports up to 50% of expenditures for pilot supporting industry production projects.
- Construction projects of research and development units are able to enjoy preferential policies on land lease and land use by the State, are received the incentives of use of land; are considered to get support up to 50% of expenses of research equipment procurement from the Supporting Industries Development Program.
e. Application and transfer support.
- Organizations and individuals conducting transferring manufacturing technology of the supporting industry products on the priority list of supporting industry products are entitled to these supportive policies on technology transfer and other supports following the currently active regulation.
- Technology application and transfer to develop supporting industry products on the priority list of supporting industry products shall be entitled to the following supports from the Supporting Industries Development Program:
+ Projects that are cooperation between the manufacturing company and the technology providing units in technology transfer are support part of the expenditure;
+ Cost of Manufacturing pilot supporting industry products on the priority list of supporting industry products is supported up to 50%.
+ The State supports up to 75% of expenses of technology transfer for material production projects using over 85% of raw domestic processing minerals including metal ores, no-metal ores and petrochemical products for supporting industry products manufacturing.
f. Labor force development support
- Supporting industries labor training.
+ Manufacturing projects in supporting industry product on the priority list of supporting industry products are funded by the Supporting Industries Development Program;
+ Individual who directly execute the tasks from the Supporting Industries Development Program is support with the domestic and oversea skill training programs following the State’s training programs.
- Labor training center for supporting industry.
+ The Government encourages organizations and individuals to invested, cooperate in establishing vocational training center to serve the need of supporting industry production;
+ Labor training center for supporting industry is support by the Science and Technology Funds and other Funds;
- The Government encourages the Universities, Colleges, Academies, and Training Centers to join in the labor training for supporting industry.
g) International cooperational support on supporting industry
- To open to international cooperation on supporting industry; especially to the countries, territories, foreign organizations and individuals, multinational corporations, foreign economic corporation that have advance science and technology to attract investments, create connection among organizations and individuals in Vietnam and international supporting industry.
- Promoting searching for and transfer advance technology to Vietnam to raise the domestic supporting industry enterprises’ qualification.
- Promoting international cooperation on supporting industry labor force development. The priority is to train students whose major in supporting industries in national and international advance universities, colleges, vocational schools; to attract and use skilled people, potential youth effectively in cooperating, researching and training supporting industry in Vietnam.
h) Support toward Small and medium sized enterprises:
Besides the above general supports, small and medium sized enterprises manufacturing supporting industry products on the priority list of supporting industry products also benefit from these policies:
- Investment credit: Small and medium sized enterprises can have up to 70% of the total investment capital loaned from the credit organizations guaranteed by the credit guarantee organization according to the laws if they meet the following condition:
+ The total value of mortgage and pledge assets at the credit organizations, according to the laws, is the minimum of 15% of the loan, after being deduced to the other loan;
+ The total owner’s loan is the minimum of 20% of the total project investment loan, after being deduced to the other projects.
+ At the time of guarantee request, the enterprise is not in State debt obligation, bad debt to any credit organization or other economic organizations.
- Land rent and water surface rent:
+ Land rent and water surface rent shall be exempted from tax according to the land laws;
+ For special or large scale projects that benefit the socioeconomic development and need higher level of support than the mentioning above, the Ministry of Finance and the Ministry of Planning and Investment to request permission from the Prime Minister in reference to the Provincial People’s Committee’s proposal.
11. Support policies for hi-tech enterprises, enterprises applying hi-tech
a. Corporate Income Tax:
According to Clause 1, Article 16, Decree No. 218/2013/ND-CP dated 26/12/2013 by the Government detailing and guiding the implementation of the Laws of CIT, newly established hi-tech enterprises and enterprises applying hi-tech benefit from these policies:
- CIT tax rate is 10% for 15 years.
- Tax exemption for 4 years and 50% tax reduction for the next 9 years.
Additionally, pursuant to Item d, Clause 1, Article 15 of this Decree, where the enterprises are enjoying the incentive corporate income tax or have stopped the enjoyment of incentive corporate income tax as prescribed by legal normative documents on corporate income tax and are issued with Certificate of high-tech enterprise or agricultural enterprise applying high-tech, then the incentives for high-tech enterprises or agricultural enterprise applying high-tech is determined by the incentives applied to the high-tech enterprise or agricultural enterprise applying high-tech minus the time of incentives enjoyment (including tax rate and time of exemption or reduction if any).
b. Clause 4, Article 16,Decree No. 218/2013/ND-CP dated 26/12/2013 by the Government specified that:
The time for tax exemption or reduction is calculated continuously from the first year of assessable income from the new investment projects entitled to tax incentive. Where there is no assessable income in the first three years, from the first year of assessable income from the new investment project, the time for tax exemption or reduction is calculated from the fourth year. The time for tax exemption or reduction applied to high-tech enterprises or agricultural enterprises applying high-tech is calculated from the time of being recognized as high-tech enterprises or agricultural enterprises applying high-tech
c. Import duty:
The following Imported goods to create fix assets for the investment enterprises categorized on Appendix I, Decree No. 87/2010/ND-CP dated 13/8/2010 by the Government detailing numbers of Articles of the Laws of Export Duty and Import Duty are exempted from import duty:
- Equipment and machineries;
- Special-use means of transport included in technological lines which cannot be domestically manufactured yet; worker-transporting vehicles including cars of 24 seats or more and waterway crafts;
- Components, details, knocked down parts, spare parts, fittings, molds and accessories accompanying machinery, equipment and special-use means of transport stated at Points a and b of this Clause for assembly into complete units;
- Raw materials and supplies which cannot be domestically produced yet, to be used for manufacturing equipment and machinery included in technological lines or for manufacturing components, details, knocked down parts, spare parts, fittings, molds and accessories accompanying equipment and machinery for assembly into complete units;
- Building materials which cannot be domestically produced yet;
- Plant varieties and animal breeds permitted to be imported for the execution of investment projects in the sectors of agriculture, forestry and fishery.
(Besides the policies above, Hi-tech projects are also receive tax incentive for 5 years after the date of manufacture of the import materials, supplies, components; Semi-finished goods that can not be domestically manufactured yet).
d. Land rent: 11 years of exemption from the date of completion and commissioning
e. Condition to be certified as hi-tech enterprise, hi-tech applying enterprise:
Pursuant to Article 1, Decision No. 55/2010/QD-TTg dated 10/9/2010 by the Prime Minister on the competence, order and procedures for certifying organizations and individuals carrying out hi-tech application or research and development operations and recognizing hi-tech enterprises; Ministry of Science and Technology may granted certificates of hi-tech application or research and development operations and hi-tech enterprise certificates.
Source: Department of Planning and Investment