Circular No.83/2016/TT-BTC guiding the application of investment incentives

Circular No.83/2016/TT-BTC dated 17 June 2016 guiding the application of investment incentives related to corporate income tax (“CIT”), import duty (“ID”) and non-agricultural land use tax (“NALUT”) in accordance with the Law on Investment 2014 and Decree No.118/2015/NĐ-CP.

1. Guiding the implementation of incentives on CIT

Circular No.83/2016 specific guidance for incentives on CIT for the project as follow:

+ New investment projects which satisfy conditions on sections to receive CIT incentives or are performed in investment incentive locations;

+ New investment projects implemented in economic zones; high-tech zones;

+ New investment projects implemented in industrial zones (except industrial park located in the conditional – favorable socio – economic);

+ New investment projects implemented export-processing zones;

+ Scientific and technological enterprises, which satisfy conditions about science and technology revenues required by law and have been granted a science and technology enterprise certificate;

In addition, Circular 83 provides that if the investment project meets various requirements for enjoying CIT incentives, the investors can choose the most favorable incentives.

2. Guiding the implementation of incentives on ID

Circular No. 83/TT-BTC specific guidance for incentives on ID

+ Investment project pertaining to business lines with investment incentives or are implemented in areas with difficult socio-economic conditions;

+ Investment projects on hotels, offices, rent apartments, houses,  technical service, commercial centers, supermarkets, golf grounds, tourist areas, sport areas, amusement parks, establishments of medical examination and treatment, education, culture, finance, banking, insurance, audit, consultancy services;

+ Investment projects with a capital scale of VND 6 trillion or more which disburse a minimum of VND 6 trillion in the three-year;

+ Projects in a rural zone and employ 500 or more employees;

+High-tech enterprises, scientific and technological enterprises, scientific institutions and technology;

+ According to Article 5 of this Circular, the following projects shall not be entitled to the exemption of import duty on materials, components imported to create fixed assets: projects on manufacturing and assembling cars, motor vehicles, air conditioners, electric heaters, fridges, laundry machines, electric fans, dish washers, CD players, sound systems, electric irons, water boilers, hair dryers, hand dryers and other commodities stipulated by the Prime Minister’s decision.

3. Guiding the implementation of incentives on NALUT

According to Circular 83/2016, exemption from NALUT for project pertains to business lines with special investment incentives or are implemented in areas with especially difficult socio-economic conditions.

In addition, there are other incentives on NALUT: Investment projects with a capital scale of VND 6 trillion or more which disburse a minimum of VND 6 trillion in the three-year; projects are in a rural zone and employ 500 or more employees; high-tech enterprises, Scientific and technological enterprises, scientific institutions and technology.

Circular 83/2016/TT-BTC shall take effect from 01/08/2016.