Draft decree on investment support fund put up for public comments

Saturday, Dec 30, 2023 09:05

Production at Korea-invested Hana Micron Vina in the northern province of Bắc Giang. Việt Nam is developing an investment support fund in an effort to remain attractive to investment while adopting the global minimum tax. — VNA/VNS Photo

The Ministry of Planning and Investment has put up for public comments a draft decree on an investment support fund as a solution to attract strategic investment in the context that Việt Nam is adopting the OECD’s global minimum tax.

The ministry said that the fund aimed to stabilise the investment climate, encourage and attract strategic investors and multinational enterprises as well as support domestic companies in prioritised sectors.

The finance for the fund would come from the State budget sourced from the collection of top-up taxes and others.

Under the draft, the fund would provide support to enterprises investing in high-tech production, high-tech companies, those with projects applying high technology which have capital scales from VNĐ12 trillion and a revenue from VNĐ20 trillion per year.

The fund would also support enterprises investing in a research and development (R&D) centre with a capital of VNĐ3,000 trillion or higher.

The support would be in cash, to be provided for training and human resource development, investment in fixed assets and social infrastructure system, high-tech product manufacturing, research and development, together with support in credit and interest rates.

The ministry raised two options for the management of the fund, under the Ministry of Finance or under the Ministry of Planning and Investment.

General Secretary of the National Assembly, Chairman of the National Assembly Office Bùi Văn Cường, was quoted by Đại Biểu Nhân Dân that the establishment of this fund would have a positive impact on attracting investments in sectors that Việt Nam is encouraging, not only for foreign investors but also domestic investors.

“This is a great initiative, a sensible step demonstrating Việt Nam’s flexibility in responding to the global minimum tax,” Trần Văn Lâm, permanent member of the National Assembly’s Finance and Budget Committee, said.

The National Assembly’s decision to establish the investment support fund would play an important role in consolidating the confidence of foreign investors in Việt Nam’s investment environment, promoting new investment and expansion, he said, adding that when the global minimum tax is applied, most of the existing corporate income tax incentives would no longer be valid for companies subject to the global minimum tax.

However, how the fund would be used would need to be studied carefully to ensure fairness, transparency and accordance with common international practices.

Minister of Planning and Investment Nguyễn Chí Dũng said the establishment of the investment support fund to encourage investments in prioritised sectors was necessary and consistent with the Politburo’s orientation.

He said that investment support policies of Việt Nam in response to the global minimum tax must ensure the competitiveness and appeal of the investment climate, appropriateness to the country’s investment attraction orientations, minimal impact on the State budget, fairness among investors, consistency with the global minimum tax rules and OECD’s guidance as well as international treaties to which Việt Nam is a member.

The support policies must be feasible and easy to implement, he stressed. — VNS

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