A view of the HCM City skyline. The city is implementing tax exemption and reduction policies to further promote start-ups under Resolution 98. (Photo: VNA) Hanoi (VNS/VNA) - The Government has issued a decreewhich provides special policies and mechanisms for corporate and personalincome tax exemption in Ho Chi Minh City.
The move comes as a response to Resolution 98, a NationalAssembly-approved resolution on piloting special mechanisms and policies forthe development of HCM City.
The decree exempts enterprises involved in innovative start-upactivities, science and technology organisations, innovation centres, andintermediary organisations supporting innovative start-ups from corporateincome tax on income generated from these activities.
The exemption will last for five years, including income generatedfrom innovative start-up activities.
In addition, personal income tax and corporate income tax forindividuals and organisations with income from capital contributions tostart-ups will also be exempted.
The tax benefits aim to enhance the city’s appeal for foreigninvestors.
To be eligible for tax benefits, individuals and start-upbusinesses must meet specific conditions and obtain certification.
These conditions include operating in priority sectors, engagingin innovative activities, and possessing certification for tax exemptionconsideration.
The country’s largest economic hub has great potential for economicgrowth and job creation thanks to its thriving start-up ecosystem.
It is home to over 2,000 start-ups, making up about 50% of allstart-ups in Vietnam.
The city is currently drafting regulations and guidelines tosupport these start-up activities, ensuring that the tax exemption policies areimplemented properly.
Phan Van Mai, Chairman of the municipal People’s Committee, saidthe tax benefits and the attraction of top talent will contribute to the growthand development of a thriving start-up ecosystem, furthering economic growthand job creation.
Prime Minister Phạm Minh Chinh, speaking at a meeting last week,called for a stronger implementation of the resolution, acknowledging itsshortcomings in implementation.
The resolution, which took effect in August last year, outlinesseveral tax benefits for start-ups in HCM City.
It encompasses 44 mechanisms and policies, addressing investmentmanagement, finance, budget, urban management, natural resources andenvironment, and science-technology management.
It also introduces a transport-oriented urban development model, afinancial mechanism to reduce greenhouse gas emissions, and solar powerinstallation on administrative office and public service unit roofs.
The new resolution replaces an older one on a pilot implementationof particular policies for HCM City’s development, issued in 2017.
The new resolution grants the city People’s Committee theauthority to decide and adjust rates and fees not included in the Law on Feesand Charges, as well as the allocation of an unassigned portion of theirbudgets to the city’s district People's Committees.
In addition, HCM City is granted the authority to collect funds tomaintain and regenerate infrastructure in industrial parks and exportprocessing zones from businesses within these areas.
It also permits the piloting of financial mechanisms to reducegreenhouse gas emissions through exchanging, clearing and trading carboncredits with domestic and international investors.
The city is also allowed to install solar power systems onadministrative office and public service unit roofs.
HCM City has a leading role in the nation’s economic landscape,contributing significantly to the country’s GDP, particularly in the industrialsector, and bolstering the State budget.
The city’s dynamic and pioneering spirit has driven reforms anddevelopment, and the resolution aims to restore its leading position afterlosing ground in recent years, experts said./.
The move comes as a response to Resolution 98, a NationalAssembly-approved resolution on piloting special mechanisms and policies forthe development of HCM City.
The decree exempts enterprises involved in innovative start-upactivities, science and technology organisations, innovation centres, andintermediary organisations supporting innovative start-ups from corporateincome tax on income generated from these activities.
The exemption will last for five years, including income generatedfrom innovative start-up activities.
In addition, personal income tax and corporate income tax forindividuals and organisations with income from capital contributions tostart-ups will also be exempted.
The tax benefits aim to enhance the city’s appeal for foreigninvestors.
To be eligible for tax benefits, individuals and start-upbusinesses must meet specific conditions and obtain certification.
These conditions include operating in priority sectors, engagingin innovative activities, and possessing certification for tax exemptionconsideration.
The country’s largest economic hub has great potential for economicgrowth and job creation thanks to its thriving start-up ecosystem.
It is home to over 2,000 start-ups, making up about 50% of allstart-ups in Vietnam.
The city is currently drafting regulations and guidelines tosupport these start-up activities, ensuring that the tax exemption policies areimplemented properly.
Phan Van Mai, Chairman of the municipal People’s Committee, saidthe tax benefits and the attraction of top talent will contribute to the growthand development of a thriving start-up ecosystem, furthering economic growthand job creation.
Prime Minister Phạm Minh Chinh, speaking at a meeting last week,called for a stronger implementation of the resolution, acknowledging itsshortcomings in implementation.
The resolution, which took effect in August last year, outlinesseveral tax benefits for start-ups in HCM City.
It encompasses 44 mechanisms and policies, addressing investmentmanagement, finance, budget, urban management, natural resources andenvironment, and science-technology management.
It also introduces a transport-oriented urban development model, afinancial mechanism to reduce greenhouse gas emissions, and solar powerinstallation on administrative office and public service unit roofs.
The new resolution replaces an older one on a pilot implementationof particular policies for HCM City’s development, issued in 2017.
The new resolution grants the city People’s Committee theauthority to decide and adjust rates and fees not included in the Law on Feesand Charges, as well as the allocation of an unassigned portion of theirbudgets to the city’s district People's Committees.
In addition, HCM City is granted the authority to collect funds tomaintain and regenerate infrastructure in industrial parks and exportprocessing zones from businesses within these areas.
It also permits the piloting of financial mechanisms to reducegreenhouse gas emissions through exchanging, clearing and trading carboncredits with domestic and international investors.
The city is also allowed to install solar power systems onadministrative office and public service unit roofs.
HCM City has a leading role in the nation’s economic landscape,contributing significantly to the country’s GDP, particularly in the industrialsector, and bolstering the State budget.
The city’s dynamic and pioneering spirit has driven reforms anddevelopment, and the resolution aims to restore its leading position afterlosing ground in recent years, experts said./.
VNA
