Công văn 86537/CT-TTHT năm 2020 về ưu đãi thuế thu nhập doanh nghiệp đối với dự án đầu tư mới trong Khu công nghiệp do Cục Thuế thành phố Hà Nội ban hành

To: Meiko Longcheer Electronics Vietnam Limited Liability Company(Address: Block CN9, Thach That – Quoc Oai Industrial Park, Phung Xa Commune, Thach That District, Hanoi City; Tax ID: 0109195170)

Replying to Official Dispatch No. 20200801/MKLC-CV dated August 25, 2020 of Meiko Longcheer Electronics Vietnam Limited Liability Company on preferential corporate income tax for new investment projects in industrial parks, Hanoi Department of Taxation gives its opinions hereunder:

- Pursuant to Article 22 of Law on Investment No. 67/2014/QH13 dated November 26, 2014 of the National Assembly:

“Article 22. Investment for establishment of a business entity

1. Investors may establish business entity as per the law. Prior to establishing business entity, foreign investors must have investment projects, adopt procedures for issuance of investment registration certificate according to Article 37 of this Law and satisfy following conditions:...”

- Pursuant to Clause 6 Article 1 Decree No. 91/2014/ND-CP dated October 1, 2014 of the Government on amendments to Decrees on tax:

“Article 1. Amendments to Decree No. 218/2013/ND-CP dated December 26, 2013 of the Government on elaborating to Law on Corporate Income Tax as follows:

...6. Amend Clause 3 Article 16 as follows:

“3. Benefit from tax exemption for 2 years and 50% reduction in payable tax in the next 4 years for income from new investment projects according to Clause 3 Article 15 of this Decree and income of enterprises from new investment projects in industrial parks (except for industrial parks located in areas with favorable socio-economic conditions).

Areas with favorable socio-economic conditions as stated in this Clause refer to inner districts of special urban areas or central type I urban areas and provincial type I urban areas, excluding districts of special urban areas, central type I urban areas and provincial type I urban areas established from districts from January 1, 2009; in case an industrial park is located on both favorable and unfavorable areas, rely on physical location of investment project to determine preferential tax for industrial park. Determination of type I special urban areas in this Clause conforms to regulations of the Government on classification of urban areas.”

- Pursuant to Decree No. 218/2013/ND-CP dated December 26, 2013 of the Government on elaborating to Law on Corporate Income Tax:

+ Clause 4 Article 16 prescribes period for exemption and reduction of corporate income tax:

“4. Period of tax exemption and reduction stated under this Article shall be calculated continuously from the first year in which taxable income is generated from new investment projects benefitting from preferential tax treatment, in case of no taxable income for the first 3 years, the first year where new investment projects generate revenues shall be the fourth year in the period of tax exemption and reduction.  Period of tax exemption and reduction for hi-tech enterprises, agricultural enterprises applying hi-tech specified under Clause 1 of this Article shall begin from the date on which such enterprises are acknowledged as hi-tech enterprises and agricultural enterprises applying hi-tech.

In case a new investment project of an enterprise has less than 12 months of business operation period eligible for tax exemption or reduction, the enterprise may choose to benefit from the tax exemption and reduction in that tax period or apply to tax authority to benefit from the tax exemption and reduction in the next tax period.”

+ Clause 2 Article 19 prescribes incomes not benefitting from preferential corporate income tax:

“2. Do not apply preferential corporate income tax specified under Clause 1, Clause 4 Article 4 and Article 15, Article 16 of this Decree and the 20% tax rate specified under Clause 2 Article 10 of this Decree to following incomes:

a) Income from capital transfer,  transfer of right to contribute to capital; income from alienation of immovable property, investment and sale of social housing specified under Point d Clause 2 Article 15 of this Decree; income from transfer of investment projects , transfer of rights to participate in investment, transfer of rights to survey and extract minerals; income generated from business operations conducted outside of Vietnam;

b) Income from search, survey and extraction of petroleum and other resources and income from mineral extraction;

c) Income from provision of services subject to excise tax according to Law on Excise Tax;

d) Other income stated under Clause 2 Article 3 of this Decree not related to business operation benefiting from preferential tax treatment (in case of satisfying requirements for preferential treatment in fields and sectors specified under Article 15 and Article 16 of this Decree);”

- Pursuant to Clause 17 and Clause 18 Article 1 of Decree No. 12/2015/ND-CP dated February 12, 2015 of the Government on elaborating to Law on amendments to Laws on Tax and amendments to Decrees on Tax:

“Article 1. Amendments to Articles of Decree No. 218/2013/ND-CP dated December 26, 2013 on elaborating to Law on Corporate Income Tax, Article 1 of Decree No. 91/2014/ND-CP dated October 1, 2014 on amendments to Articles under Decrees on tax as follows:

...17. Add Point dd Clause 2 Article 19 as follows:

“dd) Income of enterprises generated from investment projects in commercial operations and services deriving outside of economic zones, hi-tech zones, industrial parks and areas benefiting from preferential corporate income tax shall not benefit from preferential corporate income tax as stated under Clause 1, Clause 4 Article 4, Article 15 and Article 16 of this Decree.

18. Amend Clause 5 Article 19 as follows:

“5. New investment projects (including notary's offices established in areas with difficult or particularly difficult socio-economic conditions) benefitting from preferential tax stated under Clause 1, Clause 3 Article 15 and Clause 1, Clause 2 and Clause 3 Article 16 of this Decree shall be projects implemented for the first time or investment projects independent from currently active projects, except for following cases:

a) Investment projects formed from full division, partial division, consolidation, acquisition or conversion of enterprises as per the law, except for cases specified under Clause 6 Article 19 of this Decree.

b) Investment projects formed from conversion of owners (including cases of executing new investment projects while inheriting assets, business locations and business lines of old enterprises to continue business operation).

New investment projects benefitting from preferential tax according to Article 15 and Article 16 of this Decree must receive investment permit, investment certificates or permission for investment from competent authorities according to regulations and law on investment.”

- Pursuant to Circular No. 78/2014/TT-BTC dated June 18, 2014 of Ministry of Finance guiding implementation of Decree No. 218/2013/ND-CP dated December 26, 2013 of the Government on elaborating to Law on Corporate Income Tax:

+ Clause 1, Clause 2 Article 18 prescribes requirements for applying preferential corporate income tax:

“1. Preferential corporate income tax only applies to enterprises performing accounting, invoice and certificate regimes and submitting corporate income tax according to declaration.

2. During the period of preferential corporate income tax, if an enterprise performs multiple business operations, the enterprise must separately calculate income generated from business operations benefitting from corporate income tax (including preferential rate, exemption and reduction threshold) and income generated from business operations not benefitting from preferential tax treatment for separate tax declaration. 

…”

+ Article 22 prescribes procedures for implementing preferential corporate income tax:

“Enterprises shall determine requirements for preferential tax treatment, preferential rate, exemption and reduction period and amount of deficits subtracted from taxable income to declare and settle tax with tax authorities

…”

For all regulations above, the case in which investment project “Project for establishment of Meiko Longcheer Company” of foreign investors is granted investment certificate by Board for management of industrial parks and export-processing zones of Hanoi City for the first time on May 20, 2020 (project No. 9917285196), implemented at Thach That – Quoc Oai Industrial Park, Phung Xa Commune, Thach That District, Hanoi City; later, these foreign investors applied for establishment of Meiko Longcheer Electronics Vietnam Limited Liability Company (enterprise registration certificate issued by Department of Planning and Investment of Hanoi City dated May 25, 2020) to execute this project,  received first revision of investment registration certificate issued by Board for management of industrial parks and export-processing zones of Hanoi City dated July 14, 2020 (project No. 9917285196) at Thach That – Quoc Oai Industrial Park, Phung Xa Commune, Thach That District, Hanoi City (the industrial park is not situated on an area with favorable socio-economic conditions), if this investment project of the Company is a new investment project according to Clause 18 Article 1 Decree No. 12/2015/ND-CP dated February 12, 2015 of the Government, income generated by this project shall benefit from preferential corporate income tax according to Clause 6 Article 1 of Decree No. 91/2014/ND-CP of the Government dated October 1, 2014 of the Government depending on actual conditions, except for incomes specified under Clause 2 Article 19 of Decree No. 218/2013/ND_CP , Clause 17 Article 1 Decree No. 12/2015/ND-CP of the Government. 

Tax exemption and reduction period for new investment projects shall be determined based on Clause 4 Article 16 of Decree No. 218/2013/ND-CP dated December 26, 2013 of the Government.

Preferential corporate income tax mentioned above only applies to enterprises performing accounting, invoice and certificate regimes and submitting corporate income tax according to declaration.

The Company is hereby requested to rely on actual situations and refer to legislative documents above to determine requirements for preferential tax treatment, preferential corporate income tax rate eligible for benefitting as per the law and declare, settle tax with tax authorities.

During implementation of tax policies, in case of any difficulties, refer to guiding documents of Hanoi Department of Taxation uploaded on the website http://hanoi.gdt.gov.vn or contact Department of Inspection – Examination No. 2 for assistance.

Hereby for your implementation./.

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