Tax incentives Commencement rule

I. Preferential tax rate 

Generally, preferential tax rate is applicable from the first revenue-generation year; except high-tech enterprises or projects. 

II. Tax holiday 

Generally, tax holiday is available from the first profit-making year or the fourth revenue-generation year, where applicable, except high-tech enterprises. 

BY LOCATION 

ACTIVITIES

CIT INCENTIVES

PREFERENTIAL TAX RATE

TAX HOLIDAY 

With especiallly difficult socio-economic conditions 

• Economic Zones
• High-tech Zones, including concentrated information technology parks established under the Prime Minister’s decision 

10% for 15 years 

• 4 years of tax exemption; and
• 50% reduction for the next 9 years 

• With difficult socio-economic conditions 

17% for 10 years 

• 2 years of tax exemption; and
• 50% reduction for the next 4 years 

• Industrial Parks (which are not located in the favorable socio-economic locations) 

Not applicable 

• 2 years of tax exemption; and
• 50% reduction for the next 4 years 

 

BY SECTOR 

The current incentive scheme is applicable for sectors that are prioritized for investment under the Government’s development policies. 

ACTIVITIES (for example)

CIT INCENTIVES

PREFERENTIAL TAX RATE

TAX HOLIDAY

• High-tech enterprises (including science and technology enterprises); research, application, and incubation of hi- technology projects
• Environmental protection
• Investment for infrastructure development (water plant,
power, road, port, etc.)
• Software production
• Supporting industries 

10% for 15 years 

• 4 years of tax exemption; and
• 50% reduction for the next 9 years 

• Socialized projects in regions with 

difficult/especially difficult socio-economic conditions 

10% for whole project’s duration 

• 4 years of tax exemption; and
• 50% reduction for the next 9 years 

• Socialized project not located in economic regions 

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10% for whole project’s duration 

• 4 years of tax exemption; and
• 50% reduction for the next 5 years 

• Farming, husbandry, processing of 

regions; forestry in difficult regions; production of plant varieties, animal breeds; production of salt; preservation of agriculture products, aquaculture products and foods, etc. 

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10% for whole project’s duration 

• Tax exemption and reduction under incentives for location (if applicable) 

• Farming, husbandry, processing of agriculture and aquaculture products 

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15% for whole project’s duration 

• Manufacturing of steel, energy saving products, machinery and equipment serving agriculture, forestry, fisheries and salt production, traditional crafts, etc. 

17% for 10 years 

 

BY BUSINESS SCALE 

Investment incentives are granted to large projects manufacturing projects (excluding those in product manufacture subject to special sales tax or those in mineral resources exploitation) having either:

  1. Total capital of VND 6,000 billion (equivalent to USD 260,000,000) or more, disbursed within 3 years since being licensed with: 
    • Minimum annual revenue of VND 10,000 billion (equivalent to USD 43,000,000) by the 4th year of revenue generation at the latest; or
    • Regularly employing more than 3,000 employees by the 4th year of operation at the latest.
  2. Total capital of VND 12,000 billion (equivalent to USD 520,000,000) or more, disbursed within 5 years since being licensed and using technologies being evaluated under the Law on Hi-technology, and the Law on Science and Technology. 

ACTIVITIES

CIT INCENTIVES

PREFERENTIAL TAX RATE

TAX HOLIDAY

• VND 6,000 billion capital project, (equivalent to USD 260,000,000)

10% for 15 years 

• 4 years of tax exemption; and
• 50% reduction in tax for the next 9 years