Amata won Quang Ninh’s support for tax proposal
Quang Ninh’s backing is critical for Amata as it increases the chance for the firm to receive the government’s thumbs-up. If Amata’s proposal fails, the project will face trouble competing with neighbouring Dinh Vu economic zone in Haiphong city.
Quang Ninh Chairman Nguyen Duc Long said at a meeting with Amata’s representatives last week that the provincial authorities will co-operate with Amata in submitting a proposal to the government for incentives “similar to what Dinh Vu economic zone enjoys”.
Incentives offered to Dinh Vu economic zone are considered the highest of their kind in Vietnam. The incentives, if approved, will leverage Amata’s ability to attract tenants.
Current incentives for economic zones include tax cuts for their tenants, such as a 10 per cent corporate income tax (CIT) for 15 years following their operation date, CIT exemption for the first four years after they generate taxable income, and a 50 per cent reduction in taxes for the next nine years.
Amata’s project, however, is a type of industrial park. Under existing laws, incentives for industrial parks are lower than economic zones, such as only two years of tax exemption and four years of a 50 per cent reduction. There is no personal income tax reduction for employees in industrial parks.
A representative of Amata Group at the meeting confirmed it will try its best to start constructing the first phase of its project by the end of 2016 or early 2017.
Long said that the province has established a special board to facilitate the project. The board would give support to the investor in completing procedures to shorten the time for the start of construction, and help solve investor difficulties.
According to the initial plan, the project has a total area of 6,403 hectares, of which the Song Khoai IP covers 700ha. It will be Amata’s first investment in northern Vietnam.
Amata has been investing in Vietnam since 1994, when it started work on its maiden project, Amata Bien Hoa industrial park and township complex in the southern province of Dong Nai.
