Business cost inside/outside Vietnam IZs, EZs

Business cost inside Vietnam IZs, EZs

Labour cost

• Minimum labour cost (working for group of FDI enterprises): 50 USD/month ⁽²⁾

• Average labour cost (popular sectors): 50 – 70 USD/month

• Average salary of Engineers and middle-level managers: 100–250 USD/month

Additional 15% of Social insurance and 2% of Medical insurance for employee must be legally paid by employers.

City	Ha Noi	Da Nang	TP. HCM
Labour cost (USD/month) - Legal minimum wage - Workers - Semi-skilled Engineer - Middle-level Manager	64 87 – 198 243 – 482 597 – 859	50 50 – 70 100 – 200 200 – 250	64 122 – 216 329 – 453 681 – 1.690
International standard office rental(USD/m2/month)	22 – 45	10 – 25	35,2

(Source IPCC year 2007 )

Business cost outside Vietnam IZs, Ezs

+ INTERNATIONAL TRANSPORTATION

Average container shipping cost

Departure:	Da Nang, Quy Nhon
Arrival: * EU * China * Japan * US * Korea * Singapore	Container 20 feet (USD/cont)	Container 40 feet (USD/cont)
	1.200 750 750 1.500 470 220	2.400 1.400 1.400 2.800 950 450

Source: Middle-land Container Co. Ltd (VICONSHIP DANANG)

Shipping cost for 40 feet container (USD/cont)	Departure
	Hai Phong	Da Nang	TP. HCM
Arrival - Japan - US	1.110 2.873	1.400 2.800	750 2.450

+ TAX

1. Enterprise Income Tax
2. Value Added Tax
3. Luxury Tax
4. Export – Import Tax
5. Tax on Exploitation of Natural Resources
6. Personnel Income Tax
7. Other.

Taxes and Tax incentives for FDI

Enterprise Income Tax
- Enterprise Income Tax rate: 28%
- Tax incentives tariff

Incentive rate (%)	Duration	Condition *
20%	10 years	a1 hoặc b1
15%	12 years	a1 và b1
10%	15 years	a2 hoặc b2

• a₁: Investment to sectors of investment incentive
• a₂: Investment to sectors of specially investment incentive
• b₁: Investment to areas with difficult socio-economic conditions
• b₂: Investment to areas with especially difficult socio-economic conditions

· Enterprises shall be exempt from enterprise income tax for period of 2 – 4 years since taxable income generated (depending on the circumstances).

· Enterprises shall enjoy a haft of enterprise income tax rate for period of 2 – 9 years ( depending on circumstances).

· Enterprises operating in the fields of exploration, petrol exploitation, valuable and rare natural resources, shall enjoy the enterprise income tax rate of 28% – 50%.

Export Tax

Enterprises exporting goods shall enjoy the incentive tax rate of 0% – 45%.

Import Tax

Enterprises investing in sectors of investment incentive or investing in areas with difficult socio-economic conditions shall enjoy incentive tax rate on importing goods .

Value Added Tax (VAT)

• Value added tax is tax imposed on the added value of goods or services arising during the process of production, distribution to consumption. such as cigarette, wine, beer, petroleum, car with under 24 seats, air-conditioner with capacity of under 90.000 BTU, playing-card, votive objects, as well as discotheque business, massage, karaoke, casino, golf, gambling, lottery…

• Tax rate of 10% – 83%

Tax on exploitation of resources

Enterprises investing in the fields of exploitation of natural resources such as logging mining, minerals, petroleum…shall enjoy the tax rate of 0% – 40% (depending on circumstances).

Personal Income Tax

Currently, the following individuals are included in the scope of personal income tax:

• Vietnamese citizens being in Vietnam , or working or being on business trips overseas;

• Other individuals residing in who do not have Vietnamese citizenship but reside indefinitely in Vietnam

The income tax tariff for Vietnamese individuals is now:

Level	Average monthly per capital income (million VNĐ)	Phần thu nhập tính thuế/tháng (triệu VNĐ)	Rate of tax (%)
1	Đến 60	Đến 5	5
2	Trên 60 đến 120	Trên 5 đến 10	10
3	Trên 120 đến 216	Trên 10 đến 18	15
4	Trên 216 đến 384	Trên 18 đến 32	20
5	Trên 384 đến 624	Trên 32 đến 52	25
6	Trên 624 đến 960	Trên 52 đến 80	30
7	Trên 960	Trên 80	3

+ Public Service

• Public services cost

1. Electricity fee
- For industrial manufacture

Voltage (kV)	Normal time (VNĐ/kWh) (4h – 18h)	Off-peak time (VNĐ/kWh) (22h – 4h)	Peak time (VNĐ/kWh) (18h – 22h)
6 – < 22 > 110 22 – <110 < 6	860 785 815 895	480 425 445 505	1.715 1.590 1.645 1.775

- For service industry

Voltage (kV)	Normal time (VNĐ/kWh) (4h – 18h)	Off-peak time (VNĐ/kWh) (22h – 4h)	Peak time (VNĐ/kWh) (18h – 22h)
6 – < 22 > 110 22 – < 110 < 6	1.410 1.510 815 1.580	770 885 445 915	2.615 2.715 1.645 2.855

2. Water Supply fee
- For industrial manufacture: 0,2 – 0,3 USD/m³
- For service industry: 0,3 – 0,4 USD/m³

3. Telecom service expenses
* Telephone (domestic calls)
– Installation charge: 300.000 – 400.000 VNĐ/line
- Monthly charge: 27.000 VNĐ/line/month

* Internet
- Installation charge: + 300.000 – 400.000 VNĐ (new phone-line included) + 120.000 – 160.000 VNĐ (new phone-line not included)
- Monthly charge: 28.000 – 165.000 VNĐ/month

* International calls charge:
- 0,06 USD for the first block 6 sec. + 0,01 USD for each following sec.
Internet calling service has become more popular and cheap.

4. Apartment and office rental

- International standard office: 10 – 25 USD/m²/month.
- Medium standard office and apartment: 6 – 10 USD/m²/month.

5. Land rental

* For industrial zone, processing zones and economic zones

(Source: IPCC year 2007)

Tags: business cost in Vietnam, Vietnam business cost, Vietnam investment guide