Tax & Customs Alert – April 2024

This Update highlights recent tax and customs developments in Vietnam.

Global Minimum Tax (“GMT”) Implementation & Potential Tax Reforms – Update 

As an update to the implementation of the GMT policy in Vietnam, we would like to highlight that a tax workshop was recently held to discuss the next steps that Vietnam would take with respect to GMT. At the workshop, which was participated in by Government policy makers and consultants, it was reported that there are six Vietnamese domestic groups with investments in many nations, and 122 foreign multinational groups in Vietnam which are affected by the implementation of GMT. Given this, there is a need to have a set of regulation to implement GMT in Vietnam. It is noteworthy that an implementing regulation of tax in the form of Decree to be granted by the Vietnam Government has been drafted.

The Government focuses on fostering foreign investment connected to domestic enterprises. The upcoming reform on Vietnam tax policies relating to GMT appears to support this by sustaining and improving tax incentives programmes on corporate income tax and customs duty, and providing incentives relating to investment expenses such as (i) reduced land rental, (ii) use of fast depreciation accounting method, and (iv) broadened list of deductible tax expenses to foreign investment in high technology sector with a strong connection with domestic enterprises.

Following the issuance of Resolution 107 relating to GMT, Vietnam’s National Assembly passed another resolution, Resolution 110/2023/QH15 dated 29 November 2023 (“Resolution 110“). Under Resolution 110, Vietnam Government will issue a decree for the establishment of an investment support fund which will be financed from the collection of top-up tax of 15% on multinational groups subject to GMT application.

Consolidated Regulation on Certificates of Origin (COs”)

The Ministry of Commerce has issued Circular No. 03/2024/VBHN-BCT dated 2 February 2024 on guidelines on COs (“Circular 03“). Circular 03 consolidates updates to circulars relating to COs, as well as the valid provisions and guidelines contained therein, of which the latest amendment came into operation on 3 April 2018. Attached to Circular 03 is Appendix I on Product Specific Rules (“PSR“) which includes a list of goods subject to PSR.

For more information, click here to read the full Legal Update.

CONTACTS

Managing Partner
+84 28 3821 2382
Vietnam,
Chairwoman
Partner
+84 28 3821 2382
Vietnam,
Deputy Managing Partner
+84 28 3821 2382
Vietnam,
Partner
+84 24 3267 6127
Vietnam,
Partner
+84 28 3821 2382
Vietnam,
Partner
+84 28 3821 2382
Vietnam,
Partner
+84 28 3821 2382
Vietnam,
Regional Head, Mergers & Acquisitions
Co-Head, Medical, Healthcare & Life Sciences
Partner, Rajah & Tann Singapore
Partner, Christopher & Lee Ong (Malaysia)
Executive Committee Member, Rajah & Tann LCT Lawyers (Vietnam)
+65 6232 0606
Malaysia, Singapore, Vietnam,

Country

EXPERTISE

SECTORS

Share

Rajah & Tann Asia is a network of legal practices based in Asia.

Member firms are independently constituted and regulated in accordance with relevant local legal requirements. Services provided by a member firm are governed by the terms of engagement between the member firm and the client.

This website is solely intended to provide general information and does not provide any advice or create any relationship, whether legally binding or otherwise. Rajah & Tann Asia and its member firms do not accept, and fully disclaim, responsibility for any loss or damage which may result from accessing or relying on this website.

© 2024 Rajah & Tann Asia. All Rights Reserved. All trademarks are property of their respective owners.