In Update highlights recent tax and customs developments in Vietnam.
Notice on Impact on Tax Treaties Between Vietnam and other Countries
The Notice on the effectiveness of tax treaties between Vietnam and other countries (“Notice 12“) was issued by Vietnam Ministry of Foreign Affairs on 23 June 2023. Pursuant to Notice 12, Vietnam signed the multilateral convention to implement tax treaty related measures to prevent base erosion and profit shifting (commonly known as the “Multilateral Instrument” or “MLI” in short), which took effect on 1 September 2023.
The Vietnam Government has announced the modifications to some articles of the tax treaties between Vietnam and other countries.
Tax Exemption for Innovative Startup Enterprises – Special Policies for Ho Chi Minh City
Following Vietnam’s National Assembly’s passed Resolution No. 98/2023/QH15 (“Resolution 98“) on 24 June 2023, the Government granted Decree No. 11/2024/ND-CP (“Decree 11“) which took effect from 2 February 2024. Decree 11 provides some details of the implementing mechanisms and special policies to boost the economic development of Ho Chi Minh City (“HCMC“). Decree 11 provides guidance on tax incentives for enterprises having innovative startup activities conducted in HCMC during the effective period of Resolution 98. The effective date of Resolution 98 is from 1 August 2023. Its expiry date has yet to be determined.
Cambodia and Vietnam Special Preferential Tariff
The Vietnam Government issued Decree No. 05/2024/ND-CP dated January 24, 2024 on the Government of Vietnam’s Special Preferential Import Tariff to implement the Arrangement on Bilateral Trade Enhancement between the Government of the Socialist Republic of Vietnam and the Government of the Kingdom of Cambodia in the 2023-2024 period.
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