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Government Incentives Are Making Vietnam A Leading Destination for Agriculture Tech Companies
Dante Bui
September 24, 2025
Vietnam has been systematically enhancing its investment climate, especially for technology-driven agriculture. Below are essential facts, figures, and policies that make Vietnam a highly attractive market for European AgriTech companies.
1. Preferential Corporate Income Tax (CIT) Rates & Holidays
A major attraction for AgriTech and tech-oriented companies is the preferential CIT regime in Vietnam. Here are the main tiers and who qualifies:
| CIT Rate | Eligible Projects / Sectors |
| 10% for up to 15 years | New investment projects in high-technology, scientific R&D, high-tech zones, software production, renewable energy, environmental protection, clean infrastructure. Also, high-tech agricultural enterprises. |
| 15% rate | Typically for agricultural and aquatic product processing, livestock, aquaculture, crop cultivation outside especially difficult areas. |
| 17% rate | Applied for projects in prioritized industries (manufacturing, support industries, irrigation or feed production for agriculture) and in difficult socio-economic areas. Duration usually 10 years |
These incentives can dramatically reduce effective tax burdens, especially in early years of operation. For example:
- A high-tech or green-tech AgriTech firm that qualifies for the 10% rate + holiday can pay zero tax for the first ~4 years of profit, then 5% (i.e. 10% rate with 50% reduction) for the next ~9 years.
- Even for more “mainstream” agricultural value-chain firms (processing, cultivation, feed, etc.), the rate is often 15%, which is a significant saving over the standard 20% CIT.
2. Expanded Incentives under Revised Laws
Recent legal reforms have broadened the scope of incentive eligibility:
- The revised CIT Law explicitly adds hi-tech applications, software production, venture capital investment, renewable/clean energy, and infrastructure (water & electricity supply, etc.) as sectors eligible for the 10% rate.
- New projects located in high-tech parks or economic zones also tend to qualify, especially when coupled with high-tech agricultural components.
3. Other Policy Incentives & Green Growth Strategy
Beyond tax rates, the Vietnamese government has committed to multiple policy measures that favor AgriTech, especially in sustainable and low-carbon agriculture:
- The Green Growth Strategy 2021-2030 (Vision to 2050) aims to move agriculture towards ecological, organic, circular, and low-carbon pathways.
- Key targets include:
- Agricultural sector GDP growth of 2.5-3% per year.
- At least 30% of total dry crop area using advanced water-saving irrigation methods.
- ≥ 30% of fertilizer and pesticide inputs (by consumption) being organic or biological / biological plant protection substances.
- Forest coverage maintained at ~42%; over 1 million hectares of forest receiving sustainable forest management certification.
- These targets mean that infrastructure, regulatory support, and capital will increasingly favor sustainable and tech-based agricultural solutions. Companies offering smart irrigation, traceability, biotech inputs, etc., are well aligned with national goals.
4. Trade & Export Incentives: EVFTA & Market Access
Trade policy is another pillar in Vietnam’s incentive framework:
- The EU-Vietnam Free Trade Agreement (EVFTA) came into force on 1 August 2020. About 85.6% of tariff lines were immediately eliminated for Vietnamese goods; these account for ~70.3% of Vietnam’s export turnover to the EU.
- For key agricultural sectors (processed agro-products, fisheries, fruits, etc.), tariffs are being reduced dramatically:
- Processed agri-goods: from ~37% down to 6% initially, then further over time.
- Fisheries: from ~60% to 15%, then progressively down to ~2%.
These trade reductions translate into better access for Vietnam-based exporters into the EU market, making production in Vietnam more attractive for European firms who want to supply to the EU.
5. Incentives for Foreign Investment & High-Tech Agricultural Projects
Key points for European companies:
- As of end-2024, Vietnam had 729 active FDI projects in agriculture + environment sectors, with registered capital nearly USD 11.89 billion; total capital including supporting industries exceeds USD 26 billion, and the sector accounts for ~6% of total FDI inflows.
- High-tech agricultural enterprises (i.e. those applying modern/ bio/ precision/ controlled-environment tech), when certified under relevant laws, often qualify for the most favorable tax regimes (10% for 15 years, with early years of exemption or lower effective taxation).
What This Means for European AgriTech Companies
Putting all this together, the incentives environment in Vietnam offers Europe-based AgriTech firms several concrete advantages:
- Lower effective tax costs, especially for projects combining tech with agriculture, enabling more investment in R&D, infrastructure, or scaling operations.
- Reduced risk & better cash flow in early years, because of exemptions / tax holidays (4 years or more) before CIT kicks in.
- Strong alignment between national policy (Green Growth, sustainable agriculture targets) and many AgriTech business models—making it easier to get regulatory support or funding.
- Trade access into the EU under favorable terms, especially for agriculture and food-related exports, assuming standards are met.
Potential Challenges & Things to Check
While incentives are strong, European companies should verify:
- Whether the specific location (province, economic zone, high-tech park) is eligible under local rules.
- Whether their technology/project qualified under Vietnamese legislation (e.g. definitions of “high-tech enterprise,” “hi-tech agricultural applications”).
- That they can meet export/market compliance (EU standards, traceability).
- How stable and enforceable the incentives are—ensuring legal protections, looking into Investment Protection Agreements, etc.
Vietnam’s policy & economic incentives provide a compelling framework for European AgriTech firms to expand. Between deeply favorable tax rates, structured holidays, green growth targets, and access to EU markets, the environment is strongly tilted toward rewarding innovation, sustainability, and tech-driven agricultural value chains.
If your AgriTech company is looking to enter or scale into Vietnam, these incentives—especially when combined with strong execution—can significantly enhance ROI. Vitex can help you assess specifically whether your project qualifies, and help navigate registration, compliance, and partnerships. Let’s have a chat!
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