Incentives for organizations or individuals having investment projects in, or conducting activities to develop, the environmental industry would be even higher than those offered to investors in hi-tech industries.
This is proposed by the Ministry of Industry and Trade in a draft decree on policies to develop the environmental industry recently released for public opinion.
Specifically, environmental industry newcomers would be entitled to corporate income tax exemption for the first four years after establishment and a 50-percent corporate income tax reduction for the subsequent five years.
In addition, they would have to pay corporate income tax at the rate of 10 percent for incomes generated from environmental activities throughout their operation.
This is probably the most attractive package of incentives ever offered to investment projects in Vietnam. Hi-tech projects and projects in extreme difficulty-hit areas, which are currently regarded as top priorities for investment promotion, are entitled to the preferential corporate income tax rate of 10 percent in just 15 years.
In addition, machinery, components or equipment which cannot be produced at home and need to be imported for scientific research and technological development in the environmental industry would be entitled to the value-added tax rate of zero percent.
The import duty rate of zero percent or the floor rate committed by Vietnam under treaties would be applied to materials, components or equipment imported for production of environmental protection products and domestically unavailable environmental protection machinery and equipment.
Apart from tax incentives, investment projects in the environmental industry would be granted priority access to state investment credit, ODA and foreign concessional loans. They would also be entitled to support in terms of land, market development, information, and technology transfer.-