What Is the Highest Investment Incentive Level in Vietnam Today?

What Are Investment Incentives?

Investment incentives are support policies provided by the Vietnamese government to encourage businesses and investors operating in prioritized industries or locations. These incentives help reduce operating costs, improve competitiveness, and attract foreign direct investment (FDI).

Under Vietnam’s Investment Law 2020, several levels of investment incentives are available depending on the industry, project scale, and investment location.

What Is the Highest Investment Incentive Level?

According to Article 20 of the Investment Law 2020 and Decree 31/2021/ND-CP, the highest level of investment incentives currently belongs to the category of special investment incentives.

These incentives are granted to projects that have a significant positive impact on Vietnam’s economy, especially in high-tech and innovation sectors.

Key Special Incentives Include:

• Preferential corporate income tax (CIT) rates
• Extended tax exemption and reduction periods
• Land rental and water surface rental exemptions
• Additional government support policies

Highest Preferential Corporate Income Tax Rate

Vietnam’s standard corporate income tax rate is currently 20%. However, eligible projects may enjoy:

• Preferential CIT rates from 5% to 9%
• Incentive periods of up to 37 years
• Tax exemption for up to 6 years
• 50% tax reduction for up to 13 additional years

These are considered the highest investment incentives currently available in Vietnam.

Which Projects Qualify for the Highest Incentives?

1. High-Tech and Innovation Projects

Projects operating in the following sectors may qualify for special incentives:

• High technology
• Semiconductor manufacturing
• Artificial intelligence (AI)
• Research and development (R&D)
• Digital transformation
• Innovation centers

These sectors are among Vietnam’s top priorities for attracting high-quality FDI.

2. Large-Scale Investment Projects

Projects with total investment capital of:

• VND 6 trillion or more
• Or VND 12 trillion or more for certain strategic sectors

may qualify if they meet conditions related to disbursement, revenue, or employment targets.

3. Projects Located in Special Zones

Projects located in the following areas may receive stronger incentives:

• High-tech parks
• Economic zones
• Innovation centers
• Specialized industrial parks

As a result, many foreign investors prefer industrial parks that offer both infrastructure and long-term tax advantages.

Land and Infrastructure Incentives

In addition to tax incentives, investors may receive:

• Long-term land rental exemptions
• Infrastructure fee reductions
• Administrative support
• Workforce training support
• R&D assistance

Many industrial parks in Vietnam also provide “one-stop service” support for investment licensing procedures.

Important Considerations for Investors

To receive the highest investment incentives, businesses must:

• Meet all legal requirements
• Demonstrate financial capability
• Maintain project implementation schedules
• Continue operating in approved sectors

Proper investment planning and legal preparation are essential to maximize incentive benefits.

Vietnam’s Current Investment Incentive Trends

Vietnam is currently prioritizing incentives for industries such as:

• High technology
• Logistics
• Supporting industries
• Green energy
• Data centers
• Semiconductor manufacturing
• Smart manufacturing

These policies aim to attract sustainable and high-value foreign investment into Vietnam.

Conclusion

The highest investment incentive level in Vietnam today is the special investment incentive package granted to large-scale, high-tech, and innovation-driven projects.

Businesses should carefully evaluate investment locations, industries, and legal conditions to optimize tax benefits and long-term operational costs.

References

• Investment Law 2020
  https://thuvienphapluat.vn/van-ban/Dau-tu/Luat-Dau-tu-2020-427301.aspx
• Decree 31/2021/ND-CP
  https://thuvienphapluat.vn/van-ban/Dau-tu/Nghi-dinh-31-2021-ND-CP-huong-dan-Luat-Dau-tu-470262.aspx
• Ministry of Justice of Vietnam
  https://moj.gov.vn/qt/tintuc/Pages/nghien-cuu-trao-doi.aspx?ItemID=2550