[Vietnam Biz – Part 12] CIT Law 2025 Amendments on preferential tax policies for the manufacturing sector: What are the changes and who is eligible? (Part 4)

4. Differences between continued application to existing projects and new projects

Preferential tax incentives for the manufacturing sector will reach a major turning point following the 2025 amendment to the Corporate Income Tax (CIT) Law. Under the previous regime, uniform tax exemptions and reductions were granted simply based on location in an industrial park. Going forward, however, the system will be clearly divided into the old and new regimes based on the investment license issuance date. While existing projects retain the option to continue enjoying preferential treatment, new projects will be subject to new conditions, making careful consideration essential for each company. This section outlines the differences and applicable conditions step by step.

4.1. Existing projects may opt for the old regime

Manufacturing projects that obtained investment licenses before October 1, 2025 may continue to opt for the existing CIT incentive scheme of two years of tax exemption followed by four years at a 50% reduction, based on location in an industrial park. From the perspective of protecting existing projects, retroactive application of the new regime will not occur, allowing companies to continue benefiting from the old system. However, eligibility may vary depending on specific contract terms and license details, making a careful review of conditions essential. Companies must clearly identify which framework their projects fall under and formulate forward-looking investment strategies.

• ・Applies to licenses obtained before October 1, 2025
• ・No retroactive application
• ・Eligibility depends on contract and license details
• ・Correct project classification is essential
• ・Review of investment strategy is required

4.2. New projects are subject to the new rules

New projects that obtain investment licenses on or after October 1, 2025 will be subject to the new rules, under which preferential treatment is no longer granted uniformly based solely on industrial park location. Instead, stricter criteria—such as priority industries (e.g., high-tech or green industries), technological sophistication, and large-scale investment—will determine eligibility. While long-term incentives such as four years of tax exemption followed by nine years at a 50% reduction may be available, projects that fail to meet the requirements may receive fewer benefits than under the previous system. Advance confirmation of eligibility is therefore critical.

• ・Applies to licenses obtained on or after October 1, 2025
• ・Industrial park location alone does not qualify
• ・New requirements based on industry sector and investment scale
• ・Long-term incentives available if requirements are met
• ・Advance review of the system is essential

4.3. Applicable regime determined by license issuance date

The applicable preferential tax regime is clearly determined by the investment license issuance date. Projects approved before October 1, 2025 fall under the old regime, while new approvals on or after that date are subject to the new rules. Even within the same industrial park, incentive content may differ significantly depending on the timing of approval. As a result, schedule management up to license issuance will become increasingly important during investment planning.

• ・License issuance date determines the applicable regime
• ・Incentives differ by approval timing even at the same location
• ・Importance of schedule management increases
• ・Advance confirmation at the planning stage is essential
• ・Awareness of the regime transition point is critical

4.4. Verification of conditions for continued application is essential

To continue using the old regime, companies must carefully verify whether their existing projects meet the conditions for “continued application.” Key factors include contract terms, statements in the investment license, and the commercial operation commencement date. In addition, existing tax incentives may be linked with other benefits such as land lease incentives or customs duty exemptions, requiring a comprehensive review. If any uncertainties arise, companies are encouraged to actively seek advice from specialists.

• ・Detailed review of contracts and licenses required
• ・Operation commencement date may also be relevant
• ・Possible linkage with other incentive schemes
• ・Comprehensive condition review is important
• ・Consultation with experts is recommended

4.5. Further clarification through future decrees and circulars

At present, only the framework of the 2025 CIT Law and its general implementation policy have been announced. Detailed implementation rules and exception provisions are expected to be clarified through future decrees and circulars. As some aspects of the scope and criteria remain unclear, companies must closely monitor regulatory developments. When questions arise, they should rely on official announcements and expert insights to confirm incentive details and eligibility in a timely manner.