Consulting on regulations on applying investment incentives for businesses

Article overview

Investment incentives for businesses are important policies to attract investment and promote economic development. According to the Law on Investment 2020, there are 7 subjects eligible for investment incentives, including projects in priority fields, in difficult areas, on a large scale, using a lot of labor, and applying high technology. This article will analyze in detail the regulations on applying investment incentives for businesses.

Apply investment incentives for businesses
Apply investment incentives for businesses

What are investment incentives for businesses?

Investment incentives for businesses are a State policy to encourage and attract investment in priority areas and areas for development. According to the provisions of Article 15 of the Law on Investment 2020, investment incentives include the following forms:

  • Corporate income tax incentives: apply lower tax rates, tax exemptions for a certain period of time.
  • Import tax exemption for goods imported to create fixed assets and raw materials for production.
  • Exemption or reduction of land use fees, land rent, and land use tax.
  • Fast depreciation, increasing deductible expenses when calculating taxes.

The purpose of investment incentives is to create favorable financial and land conditions for businesses, thereby promoting investment in fields and areas that the State wants to prioritize for development.

Who is entitled to investment incentives?

Pursuant to Clause 2, Article 15 of the Law on Investment 2020 guided by Article 19 of Decree 31/2021/ND-CP, there are 7 groups of subjects eligible for investment incentives:

  • Investment projects in sectors and occupations eligible for investment incentives.
  • Investment projects in areas with difficult or extremely difficult socio-economic conditions.
  • Investment projects with capital of 6,000 billion VND or more, disbursement of at least 6,000 billion VND in 3 years and meeting one of two criteria: minimum revenue of 10,000 billion VND/year or employing over 3,000 workers.
  • Social housing construction investment project; Projects in rural areas employing 500 or more workers; Projects that employ disabled people.
  • High-tech, science and technology enterprises; technology transfer project; technology incubator.
  • Creative startup projects, innovation centers, research and development
  • Investment in product distribution chains of small and medium-sized enterprises; Small and medium enterprise support facility.
Subjects eligible for investment incentives for businesses
Subjects eligible for investment incentives for businesses

Principles for enjoying current investment incentives

Pursuant to Article 20 of Decree 31/2021/ND-CP on principles for applying investment incentives, some main principles are as follows:

  • Large-scale investment projects enjoy the same incentives as projects in areas with particularly difficult socio-economic conditions.
  • Projects that use a lot of labor are entitled to the same incentives as projects in areas with difficult socio-economic conditions.
  • Projects in investment incentive sectors in difficult areas receive the highest incentives.
  • Investors can choose the highest incentive level if the project meets many different incentive conditions.
  • Special investment incentives apply according to the Prime Minister’s decision for projects with major socio-economic impacts.

Consulting on issues of investment incentives for businesses

Consulting on forms of investment incentives for businesses

According to the provisions of Article 15 of the Law on Investment 2020, businesses can enjoy the following main forms of investment incentives for businesses:

  • Corporate income tax incentives: This is the most common form of incentive, including the application of lower tax rates, tax exemption, or tax reduction for a certain period of time or throughout the project implementation period. Specific incentive levels are specified in the Law on Corporate Income Tax.
  • Import tax exemption: Applicable to goods imported to create fixed assets, raw materials and components imported for production. Tax exemption conditions are specified in the Law on Import and Export Tax.
  • Land incentives: Including exemption or reduction of land use fees, land rent, and land use tax. The specific incentive level depends on the location and investment field.
  • Accelerated depreciation: Allows businesses to depreciate fixed assets faster, helping to reduce taxable income in the early years.

We will advise you on the types of investment incentives that you are entitled to, thereby supporting you in completing the documents and procedures to apply for investment incentives for you.

Consulting on procedures to apply for investment incentives for businesses

Pursuant to Article 17 of the Law on Investment 2020 guided by Article 23 of Decree 31/2021/ND-CP, procedures for applying for investment incentives are carried out as follows:

Step 1: Determine subjects and conditions for incentives: Enterprises need to review whether their investment projects are eligible for incentives according to the provisions of Articles 15 and 16 of the Law on Investment 2020 and Article 19 of the Decree. 31/2021/ND-CP or not.

Step 2: Declare incentives in the investment registration dossier: If the project is subject to investment registration, the enterprise needs to declare the incentives expected to receive in the application dossier for an Investment Registration Certificate. private.

Step 3: Self-determine the incentives to be enjoyed: Based on the Investment Registration Certificate, Investment Policy Approval Decision (if any) and relevant legal regulations, the enterprise will determine the specifics for itself. the incentives you enjoy.

Step 4: Carry out procedures to enjoy incentives at the authorities: Enterprises carry out procedures to enjoy incentives at the competent authorities:

  • Tax incentives: Carry out procedures at the tax office
  • Land incentives: Complete procedures at the environmental resources agency
  • Import tax incentives: Carry out procedures at the customs office

Step 5: Monitor and report on the status of incentive implementation: During the process of enjoying incentives, businesses need to monitor and periodically report to state management agencies on the status of project implementation and response. preferential conditions.

With a team of experienced experts, Long Phan is committed to providing customers with reputable and effective consulting services. We will support and advise you from evaluating investment incentive conditions for businesses to incentives and preparing documents, representing customers in contacting state agencies to carry out procedures. Continue to enjoy investment incentives for customers.

Consulting services on regulations on the application of investment incentives for businesses
Consulting services on regulations on the application of investment incentives for businesses

Investment incentives for businesses are an important policy to attract investment capital in priority areas and areas for development. To fully enjoy incentives, businesses need to master the legal regulations and follow the correct procedures. If you need detailed advice on investment incentives, please contact hotline 0906735386 for answers.