This is the first time a free trade zone has been permitted in the port city, implementing special mechanisms and policies to attract high-quality investment, finance, trade, tourism, services, and skilled human resources.
According to the resolution, the free trade zone will be organized into functional areas such as manufacturing, port and port logistics, logistics centers, and commercial service areas. Eligible functional areas will operate as non-tariff zones under the supervision of customs and relevant state management agencies.
The People's Committee of Hai Phong city (UBND) is authorized to establish and adjust the boundaries of the free trade zone, linking it with the Dinh Vu - Cat Hai economic zone and the southern coastal economic zone. The Hai Phong Economic Zone Management Board will directly manage the free trade zone, provide public administrative services, and support businesses in investment, production, and business activities.
The free trade zone prioritizes high-tech fields: semiconductor integrated circuits, component design and manufacturing, chips, semiconductor materials, biotechnology, new material technology, automation, supporting industries for the high-tech industry, logistics, commerce, and exhibitions.
Foreign investors can establish economic organizations within the free trade zone like domestic investors, without needing an investment registration certificate before establishment. Businesses in the zone enjoy preferential customs treatment and are exempt from specialized inspections for goods certified to meet international or regional standards.
 |
Hai Phong City Administrative Center, 23/6. Photo: Le Tan |
Hai Phong City Administrative Center, 23/6. Photo: Le Tan
Visa exemptions and significant tax incentives
Notably, the resolution allows visa exemptions and 10-year temporary residence cards for experts, scientists, exceptionally talented individuals, managers, highly skilled workers, and their family members working at businesses within the free trade zone. The city’s People's Committee is authorized to allocate and lease land without auctions or bidding for projects using land within the zone.
Projects in the free trade zone are fully exempt from land and water surface rent for the entire lease term (except for commercial housing and commercial service projects). Businesses in prioritized sectors will enjoy a 10% corporate income tax rate for 30 years, a 4-year exemption, and a 50% reduction for the next 9 years. After the preferential period, the applicable tax rate is 15%.
Additionally, experts, scientists, talented individuals, managers, and highly skilled workers in the free trade zone receive a 50% reduction in personal income tax for 10 years.
Sale of public apartment buildings built before 2025 permitted
The city’s People's Committee is permitted to sell public apartment buildings invested in by the city using the budget or under build-transfer (BT) contracts, constructed between 31/12/1994 and 1/1/2025. Buyers are households that signed house rental contracts with state agencies before 1/1/2025 or households relocated due to site clearance.
The selling price of the apartments is determined by the city’s People's Committee, including construction investment costs and land use rights value, ensuring transparency and preventing losses, waste, and negativity.
Hai Phong allowed to borrow more through bond issuance
Hai Phong is allowed to borrow through the issuance of local government bonds, from domestic financial institutions, and from the government's foreign loan sources, with the total outstanding debt not exceeding 120% of the decentralized local budget revenue. The total borrowing and annual budget deficit are decided by the National Assembly according to the State Budget Law.
The central budget will provide targeted supplements to Hai Phong's budget, covering 70% of the increased revenue from import and export activities (excluding VAT) compared to the estimate assigned by the Prime Minister. This capital will be used to invest in infrastructure for economic zones, industrial parks, the free trade zone, and socio-economic projects on Bach Long Vi island, but not exceeding the total revenue increase compared to the previous year.
Special income policy for talented individuals
The resolution allows the city to proactively generate resources for salary reform as regulated. After meeting salary and social security needs, the city’s People's Council (HDND) can decide to use the surplus for additional income for officials and public employees managed by the city, based on work performance. The payment level does not exceed 0.8 times the salary according to their position, rank, or job title.
In particular, this budget can also be used to pay incomes for experts, scientists, exceptionally talented individuals, managers, and highly skilled workers currently working in Hai Phong. The payment level is decided by the city’s People's Council.
The resolution takes effect on 1/7/2025 and will be applied after Hai Phong completes the rearrangement of provincial administrative units (merging with Hai Duong province).
Son Ha
