Press release on the Government's support policy for fishermen

On July 7, 2014, Prime Minister Nguyen Tan Dung signed and issued Decree 67/2014/ND-CP on a number of policies for fisheries development.

The Decree stipulates policies on investment, credit, insurance; tax incentives and a number of other policies applicable to Vietnamese organizations and individuals engaged in fisheries activities; organizations and individuals (called ship owners) ordering new ships, upgrading ships to serve fisheries exploitation activities; organizations and individuals implementing infrastructure investment projects serving fisheries activities.

On July 7, the Sang Fish 01 ship of fisherman Le Van Sang (Da Nang) and his brother-in-law Phan Be (Quang Ngai) arrived at the Han River, Da Nang. This is a ship that was just built in Cam Ranh (Khanh Hoa), successfully launched and tested in Da Nang. The ship is more than 25 m long, nearly 8 m wide, 3.6 m high, and has a displacement of more than 180 tons. Photo: VnExpress

According to this Decree, ship owners building or upgrading ships can borrow from banks up to 95% of the total investment value of building or upgrading ships; loan term up to 11 years; the lowest interest rate ship owners must pay is 1%/year and the highest is only 3%/year.

A/Credit policy

- Building new offshore seafood exploitation logistics service vessels (with total main engine capacity of 400CV or more), including marine machinery and equipment; seafood preservation machinery and equipment; cargo preservation; cargo loading and unloading:

+ Building new steel-hulled ships: Ship owners can borrow from commercial banks up to 95% of the total investment value of new construction with an interest rate of 7%/year, of which the ship owner pays 1%/year and the State budget subsidizes 6%/year.

+ Building new wooden ships: Ship owners can borrow up to 70% of the total investment value of new construction, with an interest rate of 7%/year, of which the ship owner pays 3%/year, and the State budget subsidizes 4%/year.

- Building new offshore fishing vessels (capacity of 400CV or more), including machinery, marine equipment; equipment for exploitation; fishing gear; seafood preservation equipment:

+ Building new steel-hulled ships (capacity from 400CV to under 800CV): Ship owners can borrow up to 90% of the total investment value for new construction with an interest rate of 7%/year, of which the ship owner pays 2%/year, and the State budget subsidizes 5%/year.

+ Building new steel-hulled ships (capacity from 800CV or more): Ship owners can borrow up to 95% of the total investment value for building new ships with an interest rate of 7%/year, of which the ship owner pays 1%/year and the State budget subsidizes 6%/year.

+ Building new wooden ships: Ship owners can borrow up to 70% of the total investment value of new construction with an interest rate of 7%/year, of which the ship owner pays 3%/year and the State budget subsidizes 4%/year.

+ Building new wooden-hulled ships with steel-hulled and new-material hulls: Ship owners can borrow up to 70% of the total investment value for new construction with an interest rate of 7%/year, of which the ship owner pays 3%/year and the State budget subsidizes 4%/year.

- Upgrading wooden-hulled ships (capacity under 400CV to ships with capacity of 400CV or more): Ship owners can borrow up to 70% of the ship upgrade value with an interest rate of 7%/year, of which the ship owner pays 3%/year and the State budget subsidizes 4%/year.

According to the Decree, the loan term will last for 11 years, in which the first year the ship owner will be exempt from interest and will not have to pay the principal. The ship owner can mortgage the value of the assets formed from the loan capital as collateral to secure the loan. The interest rate is maintained at a stable 7%/year. In case the ship owner encounters risks due to objective reasons or force majeure, depending on each case, the ship owner will be restructured by the bank to repay the debt and will be handled according to the insurance contract.

In addition, owners of fishing vessels and seafood logistics service providers who are operating effectively in the fishing industry, have financial capacity, and have specific production and business plans will be able to borrow up to 70% of the value of logistics services for fishing logistics service vessels, up to 70% of the cost of a sea voyage for fishing vessels, with an interest rate of 7%/year.

B/Insurance, tax and other policies

- Insurance policy:

The State budget supports insurance costs for offshore fishing vessels and offshore fishing logistics service vessels that are members of fishing cooperatives and have a total main engine capacity of 90CV or more.

+ Support 100% of the cost of purchasing crew accident insurance for each crew member working on the ship;

+ Annual support for insurance costs for hull, equipment, and fishing gear on each vessel at the rate of: 70% of insurance costs for vessels with capacity from 90CV to under 400CV; 90% for vessels with capacity of 400CV or more.

- Tax incentives:

+ Exemption from resource tax on naturally exploited seafood;

+ No registration fee is collected for fishing boats and ships;

+ Exemption from business license tax for aquaculture, fishing, seafood and fishing logistics services;

+ Exemption from land rent and water surface rent for aquaculture and seafood farming;

+ Seafood products sold, insurance for ships, boats, equipment and other necessary tools directly serving seafood exploitation are not subject to value added tax;

+ Owners of fishing vessels are refunded value added tax on fishing vessels for newly built or upgraded vessels with a capacity of 400CV or more;

+ Personal income tax exemption for households and individuals directly exploiting seafood;

+ Exemption from corporate income tax on income from seafood exploitation activities…;

+ Exemption of import tax on machinery, equipment, raw materials and components that cannot be produced domestically for building and upgrading ships with a capacity of 400CV or more.

- Some other policies:

+ Support 100% of training costs for crew members to operate steel-hulled ships, and provide technical guidance on exploitation and product preservation using new technology for ships with a capacity of 400CV or more;

+ Support for costs of transporting goods from the mainland to offshore fishing vessels and transporting products to the mainland; support level is 40 million VND/trip for vessels with capacity from 400CV to 800CV; 60 million VND/trip for vessels with capacity from 800CV or more;

+ Support 100% of the cost of designing steel-hulled ships with a capacity of 400CV or more;

+ 100% support for periodic maintenance and repair costs for steel-hulled ships with capacity of 400 CV or more.

This Decree takes effect from August 25, 2014.

According to chinhphu.vn