Tax Incentives for Tenants in Vinh Phuc Industrial Parks

In order to attract more investors and encourage business and production development in industrial parks, Vinh Phuc province has applied tax incentive policies and financial solutions, based on local conditions, to support tenants in industrial parks.

Specifically, Vinh Phuc has applied a 10% corporate income tax (CIT) for a 15-year period to high-tech companies and CIT earned from new scientific research and technological development projects; software production; composite material production, light construction material production, rare and precious material production; renewable energy, green energy, and waste-generated energy production;  biotechnology development;  environmental treatment equipment, environmental monitoring and analysis equipment manufacturing;  pollution treatment and environmental protection; solid waste collection, wastewater, gas emission and solid waste treatment; waste recycling and reuse; manufacturing projects with a registered investment value of VND6 trillion disbursed in less than three years from the date of licensing and earning at least VND10 trillion of revenue within three years from the year with revenue; or projects with a registered investment value of VND6 trillion disbursed in less than three years from the date of licensing and hiring at least 3,000 workers within three years from the year with revenue.

At the same time, Vinh Phuc also applies a 20% corporate income tax for a 10-year period to incomes earned from new high-grade steel production projects; energy-saving equipment production; machine and equipment manufacturing for agriculture, forestry and fishery production; irrigation equipment manufacturing; animal feed and fish feed production; and traditional handicraft development. For companies engaged in other fields, a 22% CIT rate will be applied. Tax holidays are applied in 2-4 years and a 50% reduction of payable tax is applied in the next 4-9 years.

To boost import and export activity in industrial parks, Vinh Phuc has exempted tariffs on imported goods used to form fixed assets of investment projects, ranging from equipment, machinery and transport means used in technological lines which cannot be domestically produced, components, knocked-down parts, spare parts, fixtures, molds and accessories for assembly of equipment, machinery and raw materials, which cannot be domestically produced, to make equipment and machinery in technological lines or make components.

In addition to the above tax incentives, Vinh Phuc province also introduces other incentives, for example, tax exemption and reduction of land rent and water surface rent. Specifically, the province exempts land rents and water surface rents throughout the project lifespan for land used to build common infrastructure facilities in industrial parks in line with plans approved by the relevant authorities; exempted land rents and water surface rents when construction is in progress in projects approved by the relevant authorities; exempts land rents and water surface rents in 11 years after the exemption of land rents or water surface rents in the construction process mentioned above; applies ground clearance support worth less than 15% of compensation plan and 100% of coercive expense. For foreign-invested education, health, culture and other social projects, Vinh Phuc is using the local budget to support land compensation and site clearance. For domestic investment projects, after getting the approval of the Prime Minister, Vinh Phuc is also supporting the cost of preparing documents for direct investment projects engaged in priority fields.

Together with these incentives, Vinh Phuc assisted industrial parks to train workers and access labor information; and supported worker training in places where land is taken for industrial parks. Every year, the province invests a considerable amount of budget to ask training institutions to train workers for short-term and long-term employment demands of industrial parks.

Nguyet Tham