Vietnam: Tax incentives, certain products of “supporting industries”

Vietnam: Tax incentives, “supporting industries”

Vietnam offers certain preferential treatment or incentives to foster the development of “supporting industries.” Specifically, with respect to certain products of supporting industries, the corporate income tax incentives include:

Related content

  • A preferential tax rate of 10% is available for a 15-year period.
  • A tax exemption applies for four years, and a 50% tax reduction for the subsequent nine years.

Clarifying guidance

Existing regulations did not clearly define the conditions or procedures for determining which products were eligible for the tax incentives for supporting industries. According, Vietnam’s Ministry of Industry and Trade issued guidance—Circular 55/2015/TT-BTC (30 December 2015)—that establishes certain guiding procedures with respect to eligibility for the tax incentives. The guidance addresses:

  • How to define a new investment project, manufacturing goods of supporting industries
  • What products are subject to the corporate income tax incentives
  • What is the process for the tax authorities to grant a certificate of tax incentives
  • What is the process for the withdrawal of the tax incentives certificate

KPMG observation

The tax incentives for supporting industry products is an emerging field. Potentially eligible companies will want to review their product portfolios and match this against the information provided under the recent guidance. 

The KPMG member firm has prepared two lists to help complete this analysis: 

 

Read a January 2016 report [PDF 165 KB] prepared by the KPMG member firm in Vietnam: Procedures for applying corporate income tax incentives on certain products of supporting industries

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