Circular No. 96/2011/TT-BTC guides the implementation of financial policies as stipulated in Decision No. 12/2011/QĐ-TTg dated February 24, 2011, of the Prime Minister on policies to develop certain supporting industries.

CIRCULAR

Guidelines for implementing financial policies as stipulated in Decision No. 12/2011/QĐ-TTg dated February 24, 2011 of the Prime Minister on policies to develop certain supporting industries

Based on the Law on Export Tax and Import Tax No. 45/2005/QH11 dated June 14, 2005 and Decree No. 87/2010/NĐ-CP dated August 13, 2010 of the Government detailing the implementation of some Articles of the Law on Export Tax and Import Tax;

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Based on the Law on Value Added Tax No. 13/2008/QH12 dated June 3, 2008 and Decree No. 123/2008/NĐ-CP dated December 8, 2008 of the Government detailing and guiding the implementation of some provisions of the Law on Value Added Tax;

Based on the Law on Corporate Income Tax No. 14/2008/QH12 dated June 3, 2008 and Decree No. 124/2008/NĐ-CP dated December 11, 2008 of the Government detailing and guiding the implementation of some provisions of the Law on Corporate Income Tax;

Based on the Law on Land Use Tax for Non-Agricultural Purposes No. 48/2010/QH12 dated June 17, 2010;

Based on Decree No. 198/2004/NĐ-CP dated December 3, 2004 and Decree No. 44/2008/NĐ-CP dated April 9, 2008 of the Government amending and supplementing some articles of Decree No. 198/2004/NĐ-CP dated December 3, 2004 of the Government on land use fee collection;

Based on Decree No. 120/2010/NĐ-CP dated December 30, 2010 of the Government amending and supplementing some articles of Decree No. 198/2004/NĐ-CP dated December 3, 2004 of the Government on land use fee collection;

Based on Decree No. 142/2005/NĐ-CP dated November 14, 2005 and Decree No. 121/2010/NĐ-CP dated December 30, 2010 of the Government amending and supplementing some articles of Decree No. 142/2005/NĐ-CP dated November 14, 2005 of the Government on land rental fees and water surface rental fees;

Based on Decision No. 12/2011/QĐ-TTg dated February 24, 2011 of the Prime Minister on developing certain supporting industries;

The Ministry of Finance issues guidelines for implementing financial policies as stipulated in Decision No. 12/2011/QĐ-TTg dated February 24, 2011 of the Prime Minister on policies to develop certain supporting industries as follows:

Pursuant to the Decree No. 118/2008/NĐ-CP dated November 27, 2008 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

Article 1. Scope of Application:

This Circular guides financial policies encouraging the development of supporting industries in the following sectors: mechanical manufacturing, electronics and information technology, automobile assembly, textiles and garments, leather and footwear, and supporting industries for high-tech development as prescribed in Decision No. 12/2011/QĐ-TTg.

Clause 1. State management agencies, organizations, and individuals related to supporting industries.

Article 2. Applicability

Clause 2. Production projects of supporting industry products. Among these, supporting industry products are defined according to Clause 2, Article 3 of Decision No. 12/2011/QĐ-TTg or listed in the Priority Supporting Industry Products Catalogue issued by the Prime Minister as prescribed in Point a, Clause 1, Article 5 of Decision No. 12/2011/QĐ-TTg.

Article 3. Preferential Treatment Regarding Export Tax and Import Tax

Clause 1. For projects included in the Priority Sectors for Import Tax Preferences Appendix I issued with Decree No. 87/2010/NĐ-CP dated August 13, 2010 of the Government detailing the implementation of some provisions of the Law on Export Tax and Import Tax (Decree No. 87/2010/NĐ-CP) or investing in areas eligible for import tax preferences under Clause 18, Article 12 of Decree No. 87/2010/NĐ-CP, they shall enjoy preferential treatment regarding export tax and import tax as prescribed in Article 12 of Decree No. 87/2010/NĐ-CP, specifically:

Clause 1.1. Exemption from import tax on:

c) Components, parts, sub-assemblies, spare parts, fixtures, molds, accessories accompanying equipment, machinery, and specialized transportation vehicles as specified in Points a and b of this clause;

a) Equipment and machinery;

b) Specialized transport means in domestic production chains that have not yet been produced domestically; transport means for picking up and dropping off employees including buses with 24 seats or more and watercraft;

d) Raw materials and supplies not domestically produced used to manufacture equipment and machinery within production lines or to manufacture components, parts, sub-assemblies, spare parts, fixtures, molds, and accessories accompanying equipment and machinery as specified in Point a of this clause;

Clause 1.2. The exemption from import tax on imported goods as stipulated in Clause 1.1 of this Article applies to both expanding project scale, replacing technology, and updating technology.

d) Construction materials not yet produced domestically.

Clause 1.3. Raw materials, supplies, and components not domestically produced imported for production in investment projects in priority sectors for special encouragement as specified in Appendix I issued with Decree No. 87/2010/NĐ-CP or in areas with particularly difficult socio-economic conditions (excluding automobile and motorcycle assembly projects, air conditioners, electric heaters, refrigerators, washing machines, electric fans, dishwashers, CD players, audio systems, electric irons, electric kettles, hair dryers, hand dryers, and other items as decided by the Prime Minister) shall be exempt from import tax for a period of five years, starting from the date of commencement of production.

Clause 2. Exemption from import tax on raw materials and supplies directly serving software production that are not domestically produced.

Clause 3. Exemption from import tax on goods imported for direct use in scientific research and technological development activities, including: machinery, equipment, spare parts, supplies, transportation means not domestically produced, technologies not domestically developed; scientific and technological books, journals, magazines, and electronic sources of information about science and technology.

Clause 4. Goods produced, processed, recycled, or assembled at duty-free zones without using imported raw materials or components from abroad when imported into the domestic market shall be exempt from import tax; if such goods use imported raw materials or components from abroad, only the portion of imported raw materials or components constituting the goods shall be subject to import tax upon importation into the domestic market.

Clause 5. Goods imported for production of export goods or exported to duty-free zones, if import taxes have been paid, shall be refunded corresponding to the actual proportion of exported products, and no export tax shall be levied on exported goods determined to be fully manufactured from imported raw materials.

5. Imported goods for the production of export goods or exported to a tax-free zone, if import duties have been paid, shall be refunded in proportion to the actual amount of products exported, and shall not be subject to export duties on exported goods that are determined to be wholly processed from imported materials.

6. The procedures for exemption from import tax, non-collection of export tax, and refund of tax shall be carried out in accordance with the guidance provided in Circular No. 194/2010/TT-BTC dated December 6, 2010 of the Ministry of Finance on customs procedures, customs inspection, and supervision; export tax, import tax, and tax management for exported and imported goods (Circular No. 194/2010/TT-BTC).

Article 4. Borrowing of State investment credit funds

Industrial production support projects may be considered for borrowing a portion of State investment credit funds according to the Government's regulations on State investment credit and export credit, and the implementing guidelines.

Article 5. Financial assistance policies as stipulated in the regulations on assisting small and medium-sized enterprise development

Investors of industrial production support projects that are small and medium-sized enterprises shall enjoy financial assistance policies as prescribed in Decree No. 56/2009/NĐ-CP dated June 30, 2009 of the Government on assisting the development of small and medium-sized enterprises and the implementing guidelines for Decree No. 56/2009/NĐ-CP, as follows:

Decision No. 03/2011/QĐ-TTg dated January 10, 2011 of the Prime Minister Issuing the Regulation on Guarantee for Small and Medium-Sized Enterprises to Borrow Capital at Commercial Banks.

Joint Circular No. 05/2011/TTLT-BKHĐT-BTC dated March 31, 2011 of the Ministry of Finance and the Ministry of Planning and Investment guiding training and capacity building for human resources in small and medium-sized enterprises.

Decision No. 21/2011/QĐ-TTg dated April 6, 2011 of the Prime Minister extending the deadline for payment of corporate income tax for small and medium-sized enterprises to overcome difficulties and contribute to promoting economic development in 2011; Circular No. 52/2011/TT-BTC dated April 22, 2011 of the Ministry of Finance guiding the implementation of Decision No. 21/2011/QĐ-TTg dated April 6, 2011 of the Prime Minister extending the deadline for payment of corporate income tax for small and medium-sized enterprises to overcome difficulties and contribute to promoting economic development in 2011.

Article 6. Tax incentives for projects producing industrial support products for high-tech industry development

Projects producing industrial support products for high-tech industry development shall enjoy tax policies as prescribed by the laws on high technology, specifically as follows:

1. Regarding export tax and import tax:

a) In cases where the project producing industrial support products for high-tech industry development falls within the list of sectors eligible for preferential import tax as set forth in Appendix I attached to Decree No. 87/2010/NĐ-CP or invests in areas eligible for preferential import tax as stipulated in Clause 18, Article 12 of Decree No. 87/2010/NĐ-CP, it shall enjoy preferential import tax as guided in Clause 1, Article 3 of this Circular.

b) Projects producing industrial support products for high-tech industry development shall enjoy preferential export tax and import tax as guided in Clauses 2, 3, 4, and 5, Article 3 of this Circular if they meet the corresponding conditions specified in each clause.

c) The procedures for implementing preferential export tax and import tax shall be carried out in accordance with the guidance provided in Circular No. 194/2010/TT-BTC.

2. Regarding corporate income tax:

a) In cases where the project producing industrial support products for high-tech industry development is a newly established enterprise from an investment project in the high-tech sector, scientific research and technological development, software production, or a newly established enterprise from an investment project in areas with difficult socio-economic conditions or extremely difficult socio-economic conditions..., it shall enjoy preferential tax rates, exemptions, and reductions in corporate income tax as stipulated in Chapter III of the Law on Corporate Income Tax.

The basis for implementing preferential tax rates, exemptions, and reductions in corporate income tax shall be carried out in accordance with the provisions of Decree No. 124/2008/NĐ-CP dated December 11, 2008 of the Government detailing and guiding the implementation of certain articles of the Law on Corporate Income Tax and Circular No. 130/2008/TT-BTC dated December 26, 2008 of the Ministry of Finance guiding the implementation of certain articles of the Law on Corporate Income Tax No. 14/2008/QH12 and guiding the implementation of Decree No. 124/2008/NĐ-CP dated December 11, 2008 of the Government detailing the implementation of certain articles of the Law on Corporate Income Tax and Circular No. 18/2011/TT-BTC dated February 10, 2011 of the Ministry of Finance guiding amendments and supplements to Circular No. 130/2008/TT-BTC.

Article 7. Guidelines for preferential tax policies and other revenues

1. Regarding value-added tax:

a) Enterprises with projects to produce supporting industrial products shall fulfill their value-added tax obligations in accordance with the Law on Value-Added Tax and Decree No. 123/2008/NĐ-CP dated December 8, 2008 of the Government detailing and guiding the implementation of certain provisions of the Law on Value-Added Tax.

b) Enterprises with projects to produce supporting industrial products may apply for procedures to extend payment deadlines for value-added tax and refund value-added tax on equipment, machinery, specialized transportation means within production lines, and construction materials that are not domestically produced and need to be imported to form fixed assets of the enterprise if they meet the conditions stipulated in Circular No. 92/2010/TT-BTC dated June 17, 2010 of the Ministry of Finance guiding the procedures for extending payment deadlines and refunding value-added tax on equipment, machinery, specialized transportation means within production lines, and construction materials that are not domestically produced and need to be imported to form fixed assets of the enterprise.

2. Regarding land use fees, land lease fees, water surface lease fees, and non-agricultural land use taxes:

Investment projects producing supporting industrial products in sectors eligible for investment incentives, sectors particularly eligible for investment incentives, or investments in areas with difficult socio-economic conditions or particularly difficult socio-economic conditions shall enjoy the following benefits:

a) Exemption or reduction of land use fees in accordance with Decree No. 198/2004/NĐ-CP dated December 3, 2004 of the Government on collecting land use fees; Decree No. 44/2008/NĐ-CP dated April 9, 2008 of the Government amending and supplementing certain articles of Decree No. 198/2004/NĐ-CP dated December 3, 2004 of the Government on collecting land use fees; Decree No. 120/2010/NĐ-CP dated December 30, 2010 of the Government amending and supplementing certain articles of Decree No. 198/2004/NĐ-CP and implementing guidelines.

b) Exemption or reduction of land lease fees and water surface lease fees in accordance with Decree No. 142/2005/NĐ-CP dated November 14, 2005 of the Government on collecting land lease fees and water surface lease fees; Decree No. 121/2010/NĐ-CP dated December 30, 2010 of the Government amending and supplementing certain articles of Decree No. 142/2005/NĐ-CP dated November 14, 2005 of the Government on collecting land lease fees and water surface lease fees and implementing guidelines.

c) Exemption or reduction of non-agricultural land use taxes in accordance with the Law on Non-Agricultural Land Use Tax and implementing guidelines.

Article 8. Effective Date

1. This Circular takes effect from August 18, 2011;

2. During the implementation period, if related documents cited in this Circular are amended, supplemented, or replaced, the new amended, supplemented, or replaced documents shall be implemented./.