From May 1, investment projects in border-gate economic zones and non-tariff zones will be eligible for more tax, charge, land rent and financial incentives. The central budget will also partly support important infrastructure investment projects. Large-scale investment projects to construct key infrastructure facilities in these zones will be allowed to issue project bonds.
Under Decision No. 33/2009/QD-TTg of March 2, providing for financial mechanisms and policies toward border-gate economic zones and non-tariff zones, investment projects to construct infrastructure and public-utility works necessary for border-gate economic zones will be listed among government projects calling for official development assistance (ODA). Foreign organizations and individuals as well as overseas Vietnamese can directly invest in these zones in various forms, including BOT, BT and BTO contracts.
Newly founded enterprises under investment projects in these zones will enjoy a preferential tax rate of 10% for 15 years. Investors will also enjoy corporate income tax exemption for four years and a 50% reduction in subsequent nine years from the year they earn taxable incomes from their projects.
Commodities and services manufactured, provided and consumed within non-tariff zones, those imported from abroad into these zones and those exported from these zones abroad will be exempted from value-added tax (VAT). VAT exemption will be also applied to commodities and services brought from other functional areas in border-gate zones or inland Vietnam into non-tariff zones.
Vietnamese and foreign individuals working and earning incomes in border-gate economic zones will be entitled to a 50% reduction of payable personal income tax.
Apart from the above incentives, projects in sectors in which investment is particularly encouraged by the State will be also exempted from land and water surface rents. This exemption will last 15 years after construction works are completed and put into use. Other projects will receive 11-year land rent exemption.
Upon the end of the exemption duration, investors will enjoy land and water surface rent rates equal to 30% of the lowest one applied in provinces where these zones are situated.
Particularly, investors in border-gate economic zones of Lao Cai (Lao Cai), Cau Treo (Ha Tinh), Lao Bao (Quang Tri), An Giang (An Giang), Moc Bai (Tay Ninh), Bo Y (Kon Tum), Dong Dang (Lang Son), Mong Cai (Quang Ninh) and Dong Thap (Dong Thap) will be allowed to raise funds directly from domestic and overseas entities, potential users of their infrastructure works and enterprises constructing and dealing in their technical infrastructure works, or receive co-financed credit loans of credit institutions.
The Decision is part of a plan on development of border-gate economic zones until 2020. Under the plan, by 2020 Vietnam will have a total of 30 border-gate economic zones, through which commodities and services worth USD 42-43 billion will be imported and exported and around 8 million tourists will travel.-