Samsung wants tax incentives for expanding Vietnam plant

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South Korean electronics maker Samsung is asking the Vietnamese government to provide tax incentives for its plan to increase capital investment in a local project, VnEconomy reported Thursday.

A statement from Samsung Electronics Vietnam issued last Saturday said that the company planned to raise its investment capital for Samsung's first-ever plant in Vietnam to US$1.5 billion from the original $670 million announced in 2008.

The company requested tax cuts for the investment in order to allow the firm to save money for expanding its facilities and developing advanced technology.    

Samsung Vietnam previously sought tax incentives last year to no avail. The company asked for a 10 percent corporate tax for a project to improve facilities. It also asked for a four-year tax exemption and another nine-year tax reduction of 50 percent.

The government denied the support because the plant's electronic products, including mobile phones and tablets, were no longer eligible for Vietnam's hi-tech development policy, according to VnEconomy.

The company expects export revenue of $10 billion, a full 10 percent of Vietnam's export turnover in 2012, according to the Finance Ministry's website. Expected sales this year are 40 percent higher than a year earlier.

Samsung Vietnam's 100-hectare plant in the northern province of Bac Ninh, which is Samsung's second largest plant worldwide, was first put into operation in April 2009.

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Government statistics released Friday estimated the total export revenue of companies that have received foreign direct investment in the first seven months of 2012 at $34.64 billion, up 42.5 percent from a year ago.

Vietnam's foreign direct investment fell by 27.7 percent year-on-year to $6.4 billion in the first half of 2012, according to the Foreign Investment Agency.

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