Tax Incentives for Renewable Energy Projects Vietnam 2026

Since late 2025, Vietnams entire corporate income tax (CIT) incentive framework has moved to the Law on Corporate Income Tax 67/2025/QH15 — and renewable energy projects (solar, wind, biomass) are among the biggest beneficiaries. But are the headline incentive figures unchanged, what has changed in the eligibility conditions, and which framework should ongoing projects choose?

This article updates 2026 tax incentives for renewable energy projects under Decree 320/2025/ND-CP and Circular 20/2026/TT-BTC — replacing all citations to the old tax law (Law 14/2008/QH12 and Decree 218/2013/ND-CP).

1. The new legal framework: what has changed

Item	Old framework	New 2026 framework
CIT law	Law 14/2008/QH12	Law 67/2025/QH15 (promulgated 14/6/2025; effective 1/10/2025, applicable to tax year 2025)
Incentive decree	Decree 218/2013/ND-CP	Decree 320/2025/ND-CP (promulgated 15/12/2025)
Guiding circular	Old circulars	Circular 20/2026/TT-BTC (effective 12/3/2026)

The key message: all dossiers, proposals, and feasibility studies must now cite the new framework. Citing the old tax law in an incentive application is a formal defect that can trigger supplementation requests and delay approval.

2. The four-tax table: incentives for renewable energy projects

(1) Corporate income tax — the core incentive

Eligible sector: “production of renewable energy, clean energy, and energy from waste destruction” — for new investment projects (Art. 18.2, Art. 19.1, Decree 320/2025/ND-CP).

Incentive levels:

Preferential 10% rate for 15 years (Art. 19.1, Decree 320/2025/ND-CP);
4-year tax holiday, then 50% reduction for the next 9 years;
The holiday/reduction period runs from the first year of revenue or the first year of taxable income from the project.

Technical note: the specific article numbers for the holiday/reduction in Decree 320/2025 should be verified against the original text before inclusion in formal dossiers — this article states the incentive levels per the published framework.

(2) Import duty — machinery and equipment exemption

Imported machinery and equipment forming fixed assets of the project are exempt from import duty under the Law on Export and Import Duties 107/2016/QH13. For solar and wind projects — where equipment dominates capex — this is a material saving.

(3) Value-added tax

The VAT rate for commercial electricity follows the Law on VAT 48/2024/QH15 (effective 1/7/2025). Companies should check that laws current rate schedule for electricity before building financial models — this article states no specific figure without verifying the latest original text.

(4) Land rental — exemption and reduction

Renewable energy projects enjoy land rental exemption/reduction under Decree 103/2024/ND-CP, with levels depending on location and project nature.

3. Eligibility conditions

The project must be a new investment project satisfying the investment incentive conditions in Articles 13–15, Law 67/2025/QH15, including:

Operating in an incentivized sector (renewable/clean energy);
Located in a qualifying area or meeting prescribed criteria;
Complying with the incentive dossier procedures prescribed by the Ministry of Finance (Circular 20/2026/TT-BTC).

The overall power-sector framework follows the Law on Electricity 61/2024/QH15 (effective 1/2/2025) — projects must fit the power development plan.

4. Transition: which framework for ongoing projects?

Under Article 20, Law 67/2025/QH15, projects currently enjoying incentives under the old law may choose:

To continue under the old framework for the remaining incentive period; or
To switch to the new framework for the remaining period.

This is a material financial decision: companies should model both options (post-tax cash flows over the remaining incentive period) before choosing, as the choice is hard to reverse. Compare: remaining preferential rate, remaining holiday/reduction years, and each frameworks maintenance conditions.

5. Dossiers and procedures

Incentive eligibility dossiers follow Ministry of Finance regulations (Circular 20/2026/TT-BTC). In practice, companies should prepare:

The Investment Registration Certificate / investment policy approval;
Evidence the project is in an incentivized sector and meets the conditions;
Registration of incentive application with the directly managing tax authority from the first tax period generating income.

6. Old vs. new: what investors actually gain or lose

For investors comparing the frameworks, the practical differences cluster in three areas:

Rate structure: the 10%-for-15-years preferential rate is retained in the new framework, preserving the headline benefit that made Vietnam competitive for solar and wind;
Holiday mechanics: the 4-year exemption followed by a 9-year 50% reduction continues, but the counting rules and qualifying conditions now follow Articles 13–15 of Law 67/2025 — project documentation must be re-mapped, not copy-pasted from old applications;
Transition optionality: Article 20s choice mechanism is new — under the old regime there was no clean statutory path to switch frameworks mid-stream. Ongoing projects should treat this as a one-time optimization window.

7. Five mistakes that cost projects their incentives

Citing the old law (14/2008/QH12, Decree 218/2013) in the incentive dossier — the most common formal defect;
Missing the registration timing — incentives must be registered from the first income-generating tax period; late registration can forfeit early years;
Misidentifying the start year — the 15-year clock starts with first revenue/taxable income, not with the investment certificate date;
Commingling incentivized and non-incentivized income without separate accounting — the tax authority may deny the incentive on the mixed portion;
Ignoring the power-plan fit — a project outside the power development plan fails eligibility regardless of its tax paperwork (Law on Electricity 61/2024/QH15).

8. FAQ

Q: Do rooftop solar installations qualify?
A: Incentives apply to new investment projects in renewable energy production meeting the conditions. Self-consumption rooftop solar without an investment project structure normally does not qualify — assess case by case.

Q: When does the 15-year 10% period start?
A: From the first year the project generates revenue or taxable income. Track this milestone precisely — it anchors the entire holiday/reduction schedule.

Q: Does the incentive apply to expansion of an existing project?
A: The headline incentive targets new investment projects. Expansions follow separate incentive rules for expanded investment — do not assume the new-project package carries over; assess the expansion under the applicable provisions of Law 67/2025 and Decree 320/2025.

Q: What if our project is delayed and first revenue slips by two years?
A: The 15-year preferential period and the holiday clock start from first revenue/taxable income, so a delay shifts — but does not shorten — the window. However, prolonged delay can breach investment schedule commitments in the Investment Registration Certificate, a separate risk to manage.

9. Legal bases

Law on Corporate Income Tax 67/2025/QH15 (effective 1/10/2025; replacing Law 14/2008/QH12)
Decree 320/2025/ND-CP (promulgated 15/12/2025)
Circular 20/2026/TT-BTC (effective 12/3/2026)
Law on Export and Import Duties 107/2016/QH13
Law on VAT 48/2024/QH15 (effective 1/7/2025)
Decree 103/2024/ND-CP (land rental)
Law on Electricity 61/2024/QH15 (effective 1/2/2025)

Note: Tax policy changes fast; figures follow instruments as of 14 October 2026. Verify the specific holiday/reduction articles and the electricity VAT rate against the original texts before preparing dossiers. Confirm with the tax authority before developing a project.

Transparency note: This article was prepared by the FLAW AI Legal Council; its legal content is awaiting review by the QA Council before approval. This is general legal information, not a substitute for legal advice on a specific matter.

For advice on a specific case, please contact FLAT Law Firm.