The city of Da Nang in Vietnam is set to implement tax incentives aimed at stimulating growth in the semiconductor and artificial intelligence (AI) sectors. The city’s Ministry has proposed a resolution that will exempt experts, scientists, and individuals with special talents working at semiconductor and AI companies from personal income tax for a period of five years. Additionally, businesses and intermediary organizations supporting these sectors will also be exempt from corporate income tax for the same duration.
The resolution also outlines the support processes for high-tech units using infrastructure and equipment to foster the development of science, technology, and innovation. The move comes as Vietnam aims to tap into the global semiconductor supply chain, with projections suggesting that the country could earn approximately $215 billion in revenue by 2022.
Da Nang is strategically positioned for connectivity with other regions, boasts well-established infrastructure, and has a young and ample high-tech workforce. These factors make it an ideal location for attracting investment and technology transfer from international corporations.
The tax incentives are intended to address the lack of support for experts and scientists in the semiconductor and AI fields, particularly in terms of personal income tax benefits. Start-ups in these industries often struggle to make profits in their early stages, relying on capital from angel investors and small seed investment funds. The exemption from personal income tax for a five-year period will help these individuals improve their products, access investment capital, and enter the market.
While the tax incentives may impact the state budget revenue, they are expected to attract a greater labor force to the sector and have a positive impact on Da Nang’s economic growth rate. The ultimate goal is to foster the production of high-tech products and services, promoting the development of a robust semiconductor industry in the city.
In summary, Da Nang’s implementation of tax incentives for the semiconductor and AI industries aims to attract talent, encourage investment, and drive economic growth. These incentives are expected to create favorable conditions for companies and individuals operating in the sector, positioning Da Nang as a key player in the global semiconductor supply chain.
FAQ section:
1. What tax incentives is the city of Da Nang in Vietnam planning to implement?
– The city of Da Nang is planning to implement tax incentives that will exempt experts, scientists, and individuals with special talents working at semiconductor and AI companies from personal income tax for a period of five years. Additionally, businesses and organizations supporting these sectors will also be exempt from corporate income tax for the same duration.
2. What is the purpose of these tax incentives?
– The tax incentives aim to address the lack of support for experts and scientists in the semiconductor and AI fields, particularly in terms of personal income tax benefits. These incentives will help individuals in these industries improve their products, access investment capital, and enter the market.
3. Why is Da Nang considered an ideal location for attracting investment and technology transfer?
– Da Nang is strategically positioned for connectivity with other regions, has well-established infrastructure, and boasts a young and ample high-tech workforce. These factors make it an ideal location for attracting investment and technology transfer from international corporations.
4. How does Vietnam hope to benefit from the global semiconductor supply chain?
– Vietnam aims to tap into the global semiconductor supply chain and projections suggest that the country could earn approximately $215 billion in revenue by 2022. The implementation of tax incentives in Da Nang is part of the broader strategy to foster the development of a robust semiconductor industry in the country.
Definitions:
– Semiconductor: A material with properties that allow it to conduct electricity in some conditions and act as an insulator in others. It is commonly used in the production of electronic devices.
– Artificial Intelligence (AI): The simulation of human intelligence processes by machines, typically including learning, reasoning, and problem-solving.
Suggested related links:
– Da Nang City Government
– Ministry of Industry and Trade of Vietnam
– Semiconductor Industry Association