Hanoi(VNA) -  Foreign direct investment (FDI)enterprises, which have enjoyed multiple tax incentives, pay the lowest Statetaxes despite reporting high profits, statistics show.

FDI enterprises haveachieved the highest profit growth among the economic sectors, generating 327.4trillion VND (14.4 billion USD) in pre-tax profits in 2016, an increase of 17.3percent on average in the 2010-16 period, according to the latest report by theGeneral Statistics Office (GSO).

This amountaccounted for 45.9 percent of the total profits earned by businesses across allsectors in 2016. However, they paid the lowest taxes to the State budget,amounting to only 250.9 trillion VND in 2016.

State-ownedenterprises, comprising the largest number of companies and employees, earned 197.4trillion VND in 2016, accounting for 27.7 percent of profits earned by allbusinesses, marking a 9.4 percent rise per year from 2010 to 2016.

The State-ownedsector contributed 277.3 trillion VND to the State budget in 2016, an increaseof 10.4 percent per year in the five years leading up to 2016.

Meanwhile, non-Stateenterprises reported the lowest pre-tax profits of 188.1 trillion VND in 2016but paid the highest taxes to the State budget, at 434.7 trillion VND, anincrease of 17 percent in the 2010-16 period.

[VN targets parity between FDI, domestic firms]

"The FDI sectorearns large profits, more than the other economic sectors, includingState-owned and private enterprises, but its contribution to the State budgetis lower," said Pham Dinh Thuy, director of the GSO’s IndustrialStatistics Department.

Thuy said FDIbusinesses were involved in industry and the hi-tech sector, which enjoyed manytypes of tax incentives, including those regarding corporate income.

He cited examples ofSamsung Thai Nguyen and Samsung Bac Ninh, which are exempt from corporateincome tax for the first four years of operation and must pay some 10 percentin corporate income tax in the following 27 years, half the amount domesticcompanies must pay.

Meanwhile, hi-techFDI companies are exempt from import taxes on raw materials, spare parts andcomponents.

In addition, manylocalities have implemented their own tax incentives to attract more FDIenterprises.

Some FDI businesseshave abused the legal loopholes for transfer pricing, evading VAT, whichreduced their payable tax obligations.

Thuy said thegovernment has asked the Ministry of Planning and Investment and Ministry ofFinance to review the law to help reign in transfer pricing by foreignenterprises, as well as check the tax policies of the localities to ensure afair business environment across all economic sectors. – VNA