11 RENEWABLE ENERGY POLICY IN VIETNAM
267
Fiscal Incentives. The Vietnamese government has introduced several
incentive measures for renewable energy developers including tax incentives, financing supports, and licensing. Detailed description on incentives
for wind, biomass power, and solar PV is provided below.
Incentives for Wind Power. For wind development, import tax exemptions for equipment which is not domestically manufactured can be
initiated. Developers can also qualify for a lower corporate income tax
rate, with either a 10% tax rate for the first 15 years with a possible extension up to 30 years, or an exemption for the first 4 years and a 50%
reduction for the next 9 years. A fast depreciation mechanism, 1.5 times
faster than normal projects, can be granted, followed by an exemption of
land-use tax, charges, and environmental protection fees.
Incentives for Biomass Power and Solar PV. On 26 December 2013,
the Government promulgated Decree No. 218/2013/ND-CP, which
provided detailed regulations and guidelines for the implementation of
the Law on Corporate Income Tax. According to this Decree, newly
established enterprises working on renewable energy projects can qualify
for an exemption and a reduction in corporate income tax. These enterprises enjoy a preferential tax rate of 10% (instead of the normal tax rate
of 20% applicable since January 1, 2006). On top of that, these enterprises enjoy additional tax incentives including tax exemption for the first
4 years and 50% tax reduction for the next 9 years. The corporate income
tax rate for renewable energy-based power generation enterprises can be
summarized as follows: 0% for years 1–4; 5% for years 5–13; 10% for years
14–15; and 20% from year 16 onwards.
Biomass-based power projects are exempted from import tax on
imported goods that would become fixed assets of the project and goods
used as raw materials, input or semi-finished products that are not available on the domestic market for the project operation. This is based on
the Law on Import and Export Taxes and other regulations on import
and export duties.
Market Price Support and Regulation
Net Metering. Electricity-end-users purchasing power from the national
electricity system and producing electricity (generated from renewable
sources) for their own demand may apply for the net metering mechanism. The payment for power will be calculated on the principle of net
metering at suitable prices. The power generated from renewable sources
267
Fiscal Incentives. The Vietnamese government has introduced several
incentive measures for renewable energy developers including tax incentives, financing supports, and licensing. Detailed description on incentives
for wind, biomass power, and solar PV is provided below.
Incentives for Wind Power. For wind development, import tax exemptions for equipment which is not domestically manufactured can be
initiated. Developers can also qualify for a lower corporate income tax
rate, with either a 10% tax rate for the first 15 years with a possible extension up to 30 years, or an exemption for the first 4 years and a 50%
reduction for the next 9 years. A fast depreciation mechanism, 1.5 times
faster than normal projects, can be granted, followed by an exemption of
land-use tax, charges, and environmental protection fees.
Incentives for Biomass Power and Solar PV. On 26 December 2013,
the Government promulgated Decree No. 218/2013/ND-CP, which
provided detailed regulations and guidelines for the implementation of
the Law on Corporate Income Tax. According to this Decree, newly
established enterprises working on renewable energy projects can qualify
for an exemption and a reduction in corporate income tax. These enterprises enjoy a preferential tax rate of 10% (instead of the normal tax rate
of 20% applicable since January 1, 2006). On top of that, these enterprises enjoy additional tax incentives including tax exemption for the first
4 years and 50% tax reduction for the next 9 years. The corporate income
tax rate for renewable energy-based power generation enterprises can be
summarized as follows: 0% for years 1–4; 5% for years 5–13; 10% for years
14–15; and 20% from year 16 onwards.
Biomass-based power projects are exempted from import tax on
imported goods that would become fixed assets of the project and goods
used as raw materials, input or semi-finished products that are not available on the domestic market for the project operation. This is based on
the Law on Import and Export Taxes and other regulations on import
and export duties.
Market Price Support and Regulation
Net Metering. Electricity-end-users purchasing power from the national
electricity system and producing electricity (generated from renewable
sources) for their own demand may apply for the net metering mechanism. The payment for power will be calculated on the principle of net
metering at suitable prices. The power generated from renewable sources