According to Chapter IV of Decree 82/2018/ND-CP, industrial parks in Vietnam include 4 main types: export processing zones, supporting industrial parks, ecological industrial parks, industrial – urban – service zones. . Together with the investment incentives in each industrial park, it will help the investor clearly identify the advantages of each industrial park and choose the right industrial zone for the business field.
1. Export processing zones
An export processing zone is an industrial park that concentrates on production activities of export products/services, with defined geographical boundaries established by the Government or permitted by the Government.
An export processing zone was established to help agencies and agencies easily inspect and supervise the activities of enterprises. At the same time, it greatly contributes to promoting the export-oriented economy. Because enterprises in export processing zones receive many great incentives, creating favorable conditions for development.
Incentives for enterprises in export processing zones :
- The VAT rate of 0% is applied to goods and services in export processing zones.
- Enterprise income tax exemption for 2 years and 50% reduction for the next 4 years.
It is these incentives that help businesses optimize costs, improve profits and facilitate the development of export-oriented industries and find many new business opportunities.
2. Supporting Industrial Park
Supporting industrial park is an area specializing in the production of supporting industrial products for large industries such as electronics, apparel, automobile assembly, and mechanical engineering. Enterprises in the supporting industrial park will provide products/services to large industries. In other words, the supporting industry is the industry that provides input products such as components, materials, etc. to large industries to create finished products.
The role of the supporting industrial park is very large, creating a great impetus to promote the overall economy of the country. Supporting industrial parks help increase development efficiency and competition for large industries. At the same time, these industrial parks are also one of the important links to develop the country’s industrial economy, speeding up the pace of industrialization and modernization.
Incentives for businesses in supporting industrial zones
- Enterprises operating in production and business in the supporting industrial park will receive incentives in terms of corporate income tax, import and export tax and other supports according to regulations.
- In particular, some businesses are also supported by competent state agencies to carry out procedures for confirmation of incentives in a short time (maximum 30 days) or participate in training programs, start-up support.
3. Eco-industrial park
Eco-industrial park is understood as a gathering area of businesses (manufacturing and services) connected together, aiming for social – economic – environmental benefits with high quality through cooperation in management. environmental and resource issues.
The role of the eco-industrial park is to create a close relationship between businesses and a clean and healthy production and business environment, rational and efficient use of resources. Thereby, helping businesses improve competitive advantages, creating an effective and sustainable development overall. At the same time, promoting Vietnam’s economy to develop quickly and catch up with the world’s trend of modern and smart industry.
Incentives in the eco-industrial park
- Enterprises in eco-industrial parks are given priority to get preferential loans from the Vietnam Environmental Protection Fund, the State Bank and other credit institutions. At the same time, they can participate in technical assistance programs and investment promotion programs organized by state agencies.
- Eco-industrial parks make up an overall of businesses that are closely related and mutually supportive, the output products of one unit are the input materials of other units. Thereby, helping businesses save operating costs and improve competitiveness.
If there are not many choices in eco-industrial parks, green-oriented industrial parks are also promising destinations for investors. Because green-oriented industrial parks also always uphold environmental protection factors and create a favorable business environment for development.
4. Industrial – urban – service zones
This is an industrial park with the main function, while the urban and service area is a support area, providing utility services for the industrial park such as: houses, hospitals, schools, research and development centers. …. In industrial – urban – service zones, the maximum size of the support zone does not exceed one third (1/3) of the area.
The role of the industrial – urban – service zone is to create a synchronous and multi-use area to improve the operation of the industrial park. Meeting housing facilities, cultural and sports facilities to ensure the lives of employees in the industrial park, thereby helping the industrial park develop sustainably. Since then, towards developing into industrial cities, smart cities of international standards.
Incentives in industrial – urban – service zones
- Functional zones are entitled to investment incentives in terms of corporate income tax, export tax, import tax, land rent exemption and reduction and other investment incentives according to regulations.
- As for production and business enterprises in industrial zones of industrial – urban – service zones, they are entitled to the same investment incentives as in functional zones and a number of other incentives according to regulations.
Thus, each type of industrial park has its own role and contributes greatly to the overall economic development. Investors should choose an industrial park suitable for their business type to have maximum favorable conditions for development and receive optimal incentives.
