Lidia PerskaDa Nang Introduces Game-Changing Tax Policies for Tech Innovation
In a groundbreaking move on June 26, 2024, the Da Nang City Council passed Resolution 136/2024/QH15 aimed at bolstering urban governance and testing special mechanisms and policies to advance the city.
Under this visionary plan, Da Nang is set to unleash a wave of incentives to support activities in innovation, entrepreneurship, semiconductor manufacturing, and artificial intelligence. Key measures include:
1. Tax Exemptions for Corporate Income: New tech startups, semiconductor businesses, and AI ventures will enjoy a five-year corporate income tax exemption from the time tax obligations arise.
2. Tax Exemptions for Individual and Corporate Income: Individuals and organizations investing in innovative startups, semiconductor companies, and AI ventures will be exempt from personal and corporate income tax for five years.
3. Tax Exemptions for Specialized Fields: Specialists, scientists, and individuals engaging in tech design, manufacturing, testing, and development in Da Nang will benefit from a five-year income tax waiver.
4. Non-Repayable Support: Project development costs for innovative startups will receive non-repayable aid from the city budget, covering expenses like project selection, expert hiring, labor costs, technical facilities, research and development, and technology refinement.
5. Priority Sectors Defined: The City Council will designate priority areas and establish criteria, procedures, and support levels for tech innovation, design, manufacturing, testing, and artificial intelligence activities.
With these forward-looking tax exemption measures in place, Da Nang is poised to become a hotbed of technological advancement and entrepreneurial growth.
Expanding on Da Nang’s Revolutionary Tax Exemption Measures for Tech Innovation
In addition to the tax exemptions outlined in the previous article, the Resolution 136/2024/QH15 by the Da Nang City Council includes some lesser-known facts that shed further light on the city’s strategic approach to foster technological development and economic growth.
1. What are the specific criteria for startups to qualify for tax exemptions?
To qualify for the tax exemptions, startups in Da Nang need to meet certain criteria, including demonstrating innovation in their products or services, contributing to the local economy through job creation, and actively participating in the city’s tech ecosystem.
2. How will the city monitor the impact of these tax policies on the local economy?
The City Council has set up a dedicated task force to monitor the implementation of the tax exemption measures and assess their impact on the local economy. Regular reports will be published to ensure transparency and accountability.
Key Challenges and Controversies:
One of the key challenges associated with these tax exemption measures is the potential for misuse or exploitation by businesses that may attempt to falsely claim eligibility for the incentives. Ensuring proper oversight and enforcement mechanisms will be crucial to prevent abuse of the system.
Advantages:
– Stimulating innovation: By incentivizing tech startups and AI ventures, the tax exemptions encourage innovation and creativity in the local tech ecosystem.
– Attracting investment: The tax incentives make Da Nang an attractive destination for both domestic and foreign investors looking to capitalize on the city’s supportive environment for tech development.
Disadvantages:
– Revenue implications: The tax exemptions may lead to a temporary reduction in tax revenue for the city, which could impact funding for essential public services.
– Risk of dependency: There is a risk that businesses may become overly reliant on the tax exemptions, potentially hindering long-term sustainability and growth.
To learn more about Da Nang’s innovative tax policies and their implications for technology development, visit the official Da Nang City Council website.
