The global shift toward green energy is creating a new race in the clean energy industry. Vietnam is emerging as a promising investment destination for electric vehicle (EV) battery production. Not only does Vietnam hold a strategic geographic location in Asia, it also offers attractive government incentives designed to promote investment in the green industry, particularly in EV battery manufacturing.

Investment‐Promotion Policies in the EV Battery Industry

Producing EV batteries is considered a high‐technology industry, and it is among the fields specially prioritized in Vietnam’s development orientation toward 2030. To attract investors, the State has implemented multiple investment incentive policies and specific legal supports.

Corporate Income Tax Incentives

One of the most attractive points is the exemption or reduction of corporate income tax. Under existing regulations, companies investing in high tech sectors or in high-tech zones or supporting industrial zones may enjoy:

Corporate income tax exemption for the first 4 years from when taxable income arises.
50% reduction in corporate income tax for the next 9 years.
Applying a preferential tax rate of 10% for 15 years (instead of the standard 20% rate).

These policies are especially valuable to foreign investors or domestic enterprises expanding into EV battery production—a sector requiring large investment capital and long pay‐back periods.

Clarification: Not All Projects Automatically Qualify

However, it should be noted that not every EV battery production project in Vietnam automatically receives such incentives (tax exemption for 4 years, 50% reduction for next 9 years, or leasing land with annual rent payment). Eligibility depends on several factors: whether the investment sector is listed among incentivized industries under law, whether the project location is within a high-tech zone or priority industrial zone, and what commitments the investor makes in the investment registration documents.

Thus, to fully and correctly benefit from investment incentives, investors must carefully check the legal conditions, the industrial planning at the local level, and prepare their investment documents in a way that aligns with State development orientation and the specific provisions in the Investment Law, Tax Law, and related guidance documents.

Incentives for Import Taxes and Value‑Added Tax (VAT)

Companies importing battery production lines, high-tech equipment, or rare raw materials for production often benefit from import tax and VAT exemptions for a certain period, depending on investment objectives and commitments.

The Government also allows special incentive policies if the investor demonstrates technology transfer, localization (i.e. using local components / raw materials), or contributes to the domestic supply chain of the electric vehicle industry.

Land and Technical Infrastructure Incentives

EV battery production projects are commonly allocated land in key industrial zones or high-tech parks with preferential lease rates. In addition, investors are supported with technical infrastructure such as roads, electricity, water supply, and waste treatment—critical elements in setting up industrial production plants.

Moreover, under the current Land Law and its guiding decrees, major projects may be considered for land allocation without auction or with land lease paid annually instead of in a lump sum. This helps reduce financial pressure during the initial implementation phase.

How to Fully Secure the Correct Investment Incentives

In practice, many enterprises find difficulties applying investment incentives due to misunderstandings or not complying with procedural requirements. To fully enjoy incentive policies, investors need careful legal preparation.

Develop Clear Investment Plan That Matches Planning

An EV battery production project must be included in the list of incentive industries under the Investment Law 2020 and conform to the local industrial development plan. This is not only related to eligibility for incentives, but also a condition for investment approval.

Investors should engage legal advisory services early to determine precisely their business field, the project location, and required legal documents, thus avoiding rejected applications or lost chances to receive incentives.

Prepare Complete Documents for Applying Incentives

To receive incentives, enterprises must submit an application for an Investment Registration Certificate including proposals for the incentives. Licensing authorities will base their decision on the contents of the application.

Documents to prepare carefully include: financial capacity information, technology description, environmental protection plan, socio‐economic impact assessment, land use plan, and specific proposals for forms of incentives.

Abide by Investment Commitments to Avoid Revocation

Maintaining incentives depends on the enterprise performing according to its commitments on investment timeline, production goals, and technology criteria. If there is a violation, the investor may be required to recover incentives already enjoyed or even have the Investment Registration Certificate revoked.

Therefore, the company must build a realistic implementation timeline aligned with its commitments, regularly report progress, and communicate with local authorities to update the situation or request adjustments if necessary.

Development Trends and Opportunities in the Vietnamese Market

Vietnam is aiming to become a manufacturing hub for electric vehicles and components in Southeast Asia. Many large groups such as VinFast, Samsung SDI, LG Energy Solution have taken strong steps to build EV battery factories or research EV battery technologies in Vietnam.

Participating in the EV battery supply chain in Vietnam is not only a long‐term business opportunity, but also helps enterprises affirm their position in the green industry—a sector expected to boom over the next 10 years.

Now is a golden time for investors to proactively grasp opportunities, prepare documentation and legal strategy to enter the Vietnamese market systematically, optimize effectiveness and protect long‐term rights.

Need Legal Advice for Your EV Battery Production Investment Project in Vietnam?

DEDICA Law Firm specializes in supporting foreign investors and Vietnamese enterprises implementing industrial projects: from applying for Investment Registration Certificates, registering incentives, to ongoing legal support during operations. With a team of experienced lawyers in investment, energy, and high‐technology sectors, we commit to accompany you on a sustainable investment journey in Vietnam.

Contact DEDICA Law Firm for in‐depth legal consultation!
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