Decision No. 08/2002/QD-TTg dated January 11, 2002 of the Prime Minister amending and supplementing a number of articles of the regulation on Lao Bao trade zone, Quang Tri province, issued together with Decision No. 219/1998/QD-TTG dated November 12, 1998

DECISION

AMENDING AND SUPPLEMENTING A NUMBER OF ARTICLES OF THE REGULATION ON LAO BAO TRADE ZONE, QUANG TRI PROVINCE, ISSUED TOGETHER WITH DECISION No. 219/1998/QD-TTg OF NOVEMBER 12, 1998

THE PRIME MINISTER

Pursuant to the Law on Organization of the Government of September 30, 1992;

In order to further create favorable conditions for investment and business activities in Lao Bao Trade Zone, Quang Tri province;

At the proposals of the Minister of Trade and the President of the People’s Committee of Quang Tri province,

DECIDES:

Article 1.-To amend and supplement a number of articles of the Regulation on Lao Bao Trade Zone, issued together with the Prime Minister’s Decision No. 219/1998/QD-TTg of November 12, 1998, as follows:

1. Article 19 is amended and supplemented as follows:

"Article 19.-

Organizations and individuals, when making investment in Lao Bao Trade Zone, shall enjoy the maximum preferences for investment projects in geographical areas meeting with exceptional socio-economic difficulties according to the provisions of the Law on Foreign Investment in Vietnam of November 12, 1996, the Law Amending and Supplementing a Number of Articles of the Law on Foreign Investment in Vietnam of June 9, 2000 and the Law on Domestic Investment Promotion (amended) of May 20, 1998, and preferences under the international treaties which Vietnam has signed or acceded to."

2. Article 21 is amended and supplemented as follows:

"Article 21.-

1. Projects on investment in Lao Bao Trade Zone by foreign-invested enterprises and foreign parties to business cooperation contracts shall be exempt from enterprise income tax for a duration of 08 years after their taxable incomes are generated, and enjoy the enterprise income tax rate of 10% for the subsequent years.

2. Projects on investment in Lao Bao Trade Zone by domestic organizations and individuals shall be exempt from enterprise income tax for a duration of 04 years after their taxable incomes are generated; enjoy the 50% reduction of the payable enterprise income tax amounts for 09 subsequent years; and enjoy the enterprise income tax rate of 15% for the subsequent years."

3. Article 22 is amended and supplemented as follows:

"Article 22.-

1. Foreign-invested enterprises and foreign parties to business cooperation contracts, which use their earned profits for re-investment in Lao Bao Trade Zone for 3 years or more, shall be refunded 100% of the enterprise income tax amounts already paid on the profits used for re-investment.

2. Vietnamese enterprises of various economic sectors, which make investment in production and/or business in Lao Bao Trade Zone, shall be considered for State credit capital lent by the Development Assistance Fund under the Government’s Decree No. 43/1999/ND-CP of June 29, 1999 on the State’s development investment credits."

4. Article 23 is amended and supplemented as follows:

"Article 23.-

Organizations and individuals engaged in goods production and/or trading, or services provision, foreign-invested enterprises and foreign parties to business cooperation contracts operating in Lao Bao Trade Zone, that, after making final settlement with the tax agency, suffer from losses, shall be allowed to carry forward such losses to the subsequent years, and these loss amounts shall be deducted from their taxable incomes. The loss-carrying duration shall not exceed 05 years."

5. Article 24 is amended and supplemented as follows:

"Article 24.-

Goods and service relations between Lao Bao Trade Zone and the country shall be the import-export relations."

6. Article 25 is amended and supplemented as follows:

"Article 25.-

1. Goods and services produced and consumed in Lao Bao Trade Zone, and goods and services imported into Lao Bao Trade Zone from foreign countries shall not be subject to value added tax.

2. Goods and services brought into Lao Bao Trade Zone from Vietnam’s inland shall enjoy the value added tax rate of 0%; goods and services brought into Vietnam’s inland from Lao Bao Trade Zone must be subject to value added tax.

3. Goods and services subject to special consumption tax, which are produced and consumed in Lao Bao Trade Zone, and goods and services subject to special consumption tax, which are imported into Lao Bao Trade Zone from foreign countries, shall not be subject to special consumption tax.

4. Goods and services subject to special consumption tax brought into Vietnam’s inland from Lao Bao Trade Zone shall be subject to special consumption tax."

7. Article 26 is amended and supplemented as follows:

"Article 26.-

1. Goods originating from Vietnam’s inland and goods imported into Lao Bao Trade Zone from foreign countries shall be exempt from import tax.

2. Goods produced, processed, re-cycled and/or assembled in Lao Bao Trade Zone, when being exported to foreign countries, shall be exempt from export tax."

8. Article 27 is amended and supplemented as follows:

"Article 27.-

1. For goods produced, processed, re-cycled and/or assembled in Lao Bao Trade Zone using raw materials or components imported from foreign countries, when being imported into Vietnam’s inland, the import tax shall be paid only for part of imported raw materials or components making up such products or goods. In cases where raw materials or components imported from foreign countries are not used for goods imported into Vietnam’s inland, the import tax shall not be paid.

2. Goods of Lao origin, which are imported into Vietnam’s inland from Lao Bao Trade Zone, shall enjoy the import tax reduction according to the provisions of the Prime Minister’s Decision No. 181/1998/QD-TTg of September 21, 1998 or the agreement reached between the two governments."

9. Article 28 is amended and supplemented as follows:

"Article 28.-

Organizations and individuals that have projects on investment in Lao Bao Trade Zone shall be exempt from land rents for the first 11 years as from the dates the land-lease contracts are signed, and enjoy the land-rent rate equal to 30% of the rate applicable to mountainous districts of Quang Tri province as from the 12th year on."

10. Article 30 is amended and supplemented as follows:

"Article 30.-

Basing itself on the annual State budget revenue actually collected in Lao Bao Trade Zone, the State shall re-invest in building infrastructure of Lao Bao Trade Zone at the following levels:

- In cases where the collected State budget revenue is below VND 50 billion/year, 100% of which shall be re-invested.

- In cases where the collected State budget revenue reaches VND 50 billion/year or more, VND 50 billion and 50% of the remainder shall be re-invested."

Article 2.-This Decision takes effect 15 days after its signing.

Article 3.-The ministers, the heads of the ministerial-level agencies, the heads of the agencies attached to the Government and the president of the People’s Committee of Quang Tri province shall have to implement this Decision.