Sign up for our newsletters
The best of Business news, in your inbox.
Viet Nam
Industrial Park Situation
Text by Saito Hiroshi
The 8th: Preferential treatment for Export Processing Enterprises (EPE)
Export Processing Enterprises (EPE) refer to enterprises established and operating within export processing zones, or enterprises operating within industrial parks or economic zones and exporting all of their products. Recently, a new category called Export Manufacturing Enterprises (EME) has been established, and each category is eligible for preferential tax treatments. This time, I would like to provide information about the tax incentives available to companies certified as EPE or EME.
1. Corporate tax
Currently, preferential corporate tax measures under the EPE condition have been abolished. Vietnam previously provided incentives such as a preferential corporate tax rate (10% for 15 years), as well as exemptions from import duties and VAT for EPEs. However, starting from January 1, 2012, following its accession to the WTO in 2007 to equalize domestic and foreign capital disparities, Vietnam abolished the preferential corporate tax measures for EPEs. Corporate tax has been set at 20% from January 1, 2016 (except for certain cases such as investments in high-tech sectors and remote areas).
2. Import and export duties, Value Added Tax (VAT)
EPE is considered as foreign enterprises under tax law, therefore customs procedures are required for the movement of goods between EPE facilities and within Vietnam territory. Furthermore, to qualify for treatment as a bonded factory, if EPEs export or import eligible goods, they can be exempt from import-export duties and VAT.
1) Exempt from export duties
a. EPE、輸出加工区および保税倉庫 から輸出された物品
b. ベトナム領土内の別のEPEまたは 輸出加工区および保税倉庫に対し て販売した物品
2) Import duty and VAT exemption
c. EPEでの使用、 あるいは輸出向け製 品の生産のために輸入された物品
d. 製品加工を目的にベトナム国内の 企業から購入した供給物資、 原材 料、仕掛品
e. EPE、 輸出加工区、 保税倉庫に輸 入された物品
f. ベトナム領土内の別のEPEまたは輸 出加工区・保税倉庫から購入した物 品
g. EPEが国内企業からサービス、 建設、 取り付け工事を受ける際のVAT
3. その他のメリット
1) スムーズな通関
国外からEPE向けに輸入される商品、 またEPEから国外へ輸出される商品は、 違反の兆候がある場合を除き、 実体検査 を免除され、 通常税関報告手続き終了後、 即刻通関される。 なお、 EPEが次に該当 する取引を行う場合、通関手続きは不要。
a. 同一輸出加工区内での、 EPE間の 売買取引
b. 異なる輸出加工区でのEPE間の売 買取引で、 当該取引先がグループ 会社である場合、 通関手続きの有 無が選択できる。
Differences between EPE and EME
※1: Depending on the conditions, VAT refund/deduction may be possible.
※2:EMEの輸出関税について、 鉱物等の一部輸出品は課税対象となる。
2)275日ルール (繰り延べ)の制限なし
EPEには、輸出品の生産に使用する輸 入原料の使用期限、 国外への製品輸出期 限がない。 EPE以外の企業には、 輸出品 生産のための原料輸入時、 申告登録日か 275日以内に完成した製品を国外へ輸 出しない場合は、 輸入税の納税義務があ る (275日ルール、 繰り延べ)
3) VAT申告の簡素化
EPEs are not required to file VAT declarations monthly. Recently, a new category called EME (Exporting Manufacturing Enterprises) has been introduced, which is reportedly easier to obtain than EPE. Please refer to the comparative table above for the differences between the two.
While EPE or EME enterprises can enjoy the above-mentioned benefits, they are not highly recommended for enterprises that are considering future domestic sales in Vietnam. While it is legally possible to change the status from EPE/EME to non-EPE/EME, in practice, there seem to be very few cases where enterprises have gone through such a procedure. The reason is that when changing the status, there is a high possibility of being required to suspend production for an extended period due to an investigation by customs authorities.
Both EPE and EME have complex application procedures, so it is recommended to entrust the application process to specialized agents.
The steps to apply for EME (Exporting Manufacturing Enterprises) status are as follows
齊藤公(Saito Hiroshi)
Business Advisor
G.A. Consultants Vietnam Co., Ltd
After graduating from university, he joined a PHP research institute and served as the head of the New York office. He then worked on the “Nagoya Port Redevelopment Project” at a subsidiary of the Chubu Nippon Broadcasting (CBC) company. He later shifted his base to Asia, where he was involved in the launch of “FM96.3” in Singapore, and the creation of “Hello Vietnam” and “Invest Asia” magazines in Vietnam. He then joined BW Industrial Development JSC, Vietnam’s largest rental factory development company, where he was responsible for attracting Japanese manufacturing companies. Currently, he is active as a consultant for the entry of Japanese companies at “G.A. Consultants”, one of the longest-standing Japanese HR consulting firms in Vietnam.
