foreign debt repayment of enterprises ... cancellation of outstanding tax, fine or interest on late payment of tax inclu
TAX POLICIES Page
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Guidance on implementation of the Law on tax administration
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Private tax rulings REGULATIONS ON STATE MANAGEMENTAND INVESTMENT
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Law on management and use of public assets
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Regulations on authorizes or hires audit firms to carry out audit engagement
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Abolishing regulations on the list of products and goods need to be inspected quality
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Provisional safeguard measures shall be applied to fertilizer products
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Regulations on calculation and collection of fee for granting water exploitation right
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Guidance on calculation for granting the mineral mining right
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Regulations on the management and use of revenues from project management activities of investors, project management units of the state budget
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Regulations on financial management of investment projects in the form of public-private partnership and costs of investor selection
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Guidance on raising capital for house construction and real estate trading in accordance with the Law on housing and Law on real estate REGULATIONS ON BANKS AND CREDIT INSTITUTIONS
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Amending and supplementing a number of regulations on the purchase, sale, and settlement of bad debts of Vietnam Asset Management Company
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Financial regulations applicable to branches of foreign banks and credit institutions and financial supervision, performance assessment of State capital in credit institutions of which the charter capital wholly is held by the State and State-invested credit institutions
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Regulations on orders and procedures of supervision of banks
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Instructions on foreign exchange administration in respect of foreign borrowing and foreign debt repayment of enterprises
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Regulations on People's credit fund
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Regulations on safety protection for operation of People's credit funds
TAX POLICIES 1 . Guidance on implementation of the Law on tax administration under Circular No. 79/2017/TT-BTC dated 01/08/2017 by Ministry of Finance
The remaining money or assets of the company that is declared bankrupt are not sufficient to pay tax after making the payments prescribed by the laws on bankruptcy, documentation for cancellation of outstanding tax, fine or interest on late payment of tax including original or certified version of: A decision to declare bankruptcy issued by the court; document on assets division determined by the enforcer (indicating recovered tax amount or unrecovered tax amount) and suspension of Decisions on declaration of bankruptcy by the civil execution authority, simultaneously decision on asset liquidation enclosed with an asset division scheme is removed.
2 . Private tax rulings
Official Dispatch No. 3583/TCT-CS dated 11/08/2017 on VAT refund for business that has investment projects of the list of conditional business line does not meet the conditions in accordance with the Law on investment or does not maintain adequate business conditions during operation: such business is not eligible for VAT refund and the tax amount that has not been deducted is transferred to the next period.
Official Dispatch No. 3541/TCT-KK dated 09/08/2017 on handling tax obligations of branch that has stopped operation in different location than its head office:
- Regarding VAT: input VAT that has not been deducted at the time the branch's operation is stopped shall be transferred to the parent company for monitoring. The Tax Department confirmed the completion of the branch's tax obligations, including input VAT which has not yet fully deducted at the time that the operation is stopped.
- Regarding CIT: in case the company's branch is production facility (including manufacturing, assembling), the company may declare and perform tax settlement with the Tax Department in
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area where the head office is located, if any CIT arises, the company is responsible for allocating the payable amount corresponding to the tax amount arises in the branch in order to submit to the Tax Department in area where the branch is located as prescribed.
Official Dispatch No. 3392/TCT-KK dated 31/07/2017 on the declaration and payment of overpaid withholding tax: In case foreign contractors are subcontractor to the main contractor in Vietnam and perform the design, manufacturing, testing, delivery, installation supervision and pilot operation in other areas where the main contractor based in Vietnam. The main contractor paid on behalf of foreign contractors the overpaid CIT in areas where the headquarters of the main contractor is located, the main contractor will perform the procedure for reimbursement of overpaid amount at the headquarter and offset amount payable of foreign subcontractors in areas where the equipment installation is placed.
Official Dispatch No. 3395/TCT-CS dated 31/07/2017 regarding personal income tax on income from capital investment activity: Before 01/1/2015, personal income tax from capital investments is included in income received from capital contribution to limited liability company (including one-member limited liability company). From 01/1/2015, profits distributed to individual who is the owner of one-member limited liability company after payment of corporate income tax shall not include personal income tax.
Official Dispatch No. 2562/TCT-DNL dated 13/06/2017 on invoice and tax obligations for exploitation activities pending the disposal of security asset: Pending the disposal of the security asset, if Banks exploit or authorize a third party to exploit the security asset for repayment of principal, such Banks must issue invoice or authorize third party to issue invoice to the lessee, in which name of the Banks must be clearly stated.
Pending the disposal of the security asset, if revenue is generated from the lease of security assets, such revenue is subject to VAT. This revenue after subtracting related expenses is considered as the income of the Bank and shall be declared and paid CIT.
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REGULATIONS ON STATE MANAGEMENT AND INVESTMENT 1 . Law on management and use of public assets No. 15/2017/QH14 approved by the National Assembly dated 21/06/2017
2 . Promulgation of regulations on authorizes or hires audit firms to carry out audit engagement under Decision No. 09/2017/QĐ-KTNN dated 15/08/2017 by State audit
The State audit may authorize or hire audit firms to carry out audit engagement at: socio-political organizations, socio-political-professional organizations, social organizations, socioprofessional organizations using funding provided by the State; Public service agencies; Management boards of projects whose funding is provided by State budget; Associations, union of associations, confederation and other organizations whose funding is provided partially by the State budget; Enterprises with over 50% charter capital of which is held by the State, etc.
The State audit may not authorize or hire audit firms to carry out audit engagement at Ministries, ministerial agencies, Governmental agencies; Agencies assigned to execute state budget receipts and expenditures at various administrative levels; The People's Councils, the People's Committees, other local regulatory agencies; Units of the People's armed forces, etc.
According to the Regulations, an auditing firm may be considered, authorized or hired to conduct audit engagement if the following conditions are met: an auditing firm eligible to provide audit services; There were no frauds, violations in the preceding 03 years; those who hold managerial, administrative positions are not members, founding shareholders, or purchasing shares or capital contribution in the audited unit; persons who hold managerial, administrative positions whose father, mother, wife/husband, children, brother, and sister are not founding shareholders, or purchasing shares or capital contribution and have significant influence on the audited unit, etc.
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3 . Abolishing regulations on the list of products and goods need to be inspected quality under Decision No. 37/2017/QĐ-TTg dated 17/08/2017 by the Prime Minister
Accordingly, organizations and individuals manufacturing, trading, importing products and goods which were previously inspected based on standards of human health, safety, environment before circulating in the domestic market, such products and goods will not require inspecting until new guidance documents prevail. The Decision takes effect from 05/10/2017.
4 . Provisional safeguard measures shall be applied to the imports of DAP and MAP fertilizers under Decision No. 3044/QĐ-BCT dated 04/08/2017 by the Ministry of Industry and Trade
5 . Regulations on calculation and collection of fee for granting water exploitation right under the Government's Decree No. 82/2017/NĐ-CP dated 17/07/2017
Accordingly, levy for grant of right to exploit water resources based on the ratio of 0,1 - 2% and applied for exploiting water for hydro-power, business, service, non-agricultural manufacture, breeding cattle and aquaculture purposes. The Decree takes effect from 01/09/2017 and abolishes provisions at Article 40, clause 3, Article 47 of the Government's Decree No. 201/2013/NĐ-CP dated 27 November 2013.
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6 . Guidance on calculation for granting the mineral mining right under Official Dispatch No. 3888/BTNMT-ĐCKS dated 31/07/2017 by Ministry of Natural Resources and Environment.
Accordingly, Decisions on approval for granting the mineral mining right issued after the Decree No. 158/2016/NĐ-CP dated 29/11/2016 takes effect shall apply charges for granting mineral extraction right (R) based on provisions at Appendix II promulgated together with Decree No. 158/2016/ND-CP. Otherwise, Decisions issued after the Decree No. 158 takes effect are not valid, evaluated and shall be resubmitted for approval.
Regarding the charges for granting the mineral mining right annually submitted to the local taxation Departments where have mineral zones licensed for mining in accordance with the regulations at provision 1 and provision 2, Article 15 under the Government's Decree No. 203/2013/ND-CP dated 28/11/2013:
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Charge payables in 2017 as regulated in Decree No. 2013 must be announced before 31/12/2016 (the date of which the Decree No. 158 takes effect) and in accordance with regulations at Appendix I attached to the Decree No. 203.
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Charge payables from 2018 onwards, as regulated in Decree No. 2013 must be announced before 31/12/2017, the calculation method is determined according to guidance of this Official Dispatch.
7 . Regulations on the management and use of revenues from project management activities of investors, project management units of the state budget under Circular No. 72/2017/TT-BTC dated 17/07/2017 by Ministry of Finance
The Circular takes effect from 15/9/2017, accordingly detailed regulates expenses of investors, Project management unit (PMU), regarding salaries to cadres and employees shall be counted on rank-based salaries, position-based salaries specified by State, and remunerations paid to employees based on specific jobs as agreed.
Besides, based on the volume of works completed, fully conducted obligations with State budget, and operating results in the year, the PMU decided the total payment of extra remunerations to employees which are not exceed 03 times higher than grade- and rank-based salaries, position and remunerations to cadres, civil servants, public employees. Regulations on paying the increased income in direction of attaching to volume and task of the assigned works, and extent of finishing the work. The level of increased income to leadership titles must not exceed 2 times higher than the average level of employees in the unit and also based on the volume, quality and work efficiency.
The Circular also detailed regulates about the use of difference between income and expenses (if any) after completing the obligations with the State budget, conduct financial statements in accordance with accounting system applicable to units of investors and make settlement report of revenue and expenditure as basis to make estimate of next year.
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8 . Regulations on financial management of investment projects in the form of public-private partnership and costs of investor selection under Circular No. 75/2017/TT-BTC dated 21/07/2017 by Ministry of Finance
Accordingly, the Circular amends and supplements a number of provisions under Circular No. 55/2016/TT-BTC regarding interest of mobilized loans in specific cases such as investor selection. The Circular takes effect from 05/9/2017.
9 . Guidance on raising capital for house construction and real estate trading in accordance with the Law on housing and Law on real estate under Official Dispatch No. 215/BXD-QLN dated 04/08/2017 by Ministry of Construction
According to Ministry of Construction, investors of house construction projects may raise capital in the form of capital contribution, investment cooperation, BCC, joint venture and associate with other organizations; Profit distribution (in cash or shares) to partners based on their contribution rate as agreed in the contracts and the investors are not allowed to distribute profit in the form of houses to their business partners.
Only enterprise who is project investor as approved by the competent authority can sign contract on leasing, trading house, mortgage contract or trading land use right in the project and is not allowed to authorize other parties to invest in the form of joint venture, associate, BCC, or capital contribution in order to sign sale contract, transfer, lease to purchase real estate. In case the State Agency approved the decision on allowing both two companies are the project investor and handing over land to implement the new projects, such two companies are eligible to jointly invest in the project as prescribed.
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REGULATIONS ON BANKS AND CREDIT INSTITUTIONS 1 . Amending and supplementing a number of regulations on the purchase, sale, and settlement of bad debts of Vietnam Asset Management Company under Circular No. 09/2017/TT-NHNN dated 14/08/2017 by the State bank.
The Circular takes effect from 15/08/2017, in which amend and supplement number of regulations under Circular No. 19/2013/TT-NHNN regarding the settlement of bad debts which were purchased by Vietnam Asset Management Company (VAMC), guidance on selling bad debts and use of provision for credit risks, etc.
2 . Financial regulations applicable to branches of foreign banks and credit institutions and financial supervision, performance assessment of State capital in credit institutions of which the charter capital wholly is held by the State and State-invested credit institutions under the Government's Decree No. 93/2017/NĐ-CP dated 07/08/2017.
The Decree takes effect from 25 September 2017, replaces Decree No. 57/2012/NĐ-CP dated 20 July 2012. Regarding content of the supervision and performance assessment of State capital in State-invested credit institutions shall take effect from 2018.
Regarding above-mentioned credit institutions, the Decree specifically regulates the management mechanism, use of capital and assets; revenue, expenses and profit distribution; financial plan, report system, audit and financial supervision and performance assessment of State capital in enterprises; responsibility of the Board of Management, Board of Members, General Director, Director and representative of credit institution, branch of foreign bank; responsibility of Ministry of Finance and State bank of Vietnam in management and supervision of financial for credit institution and branches of foreign banks.
The Decree also regulates the distribution of profit after CIT for credit institutions that are cooperatives, after appropriation to funds according to required rate; the remaining profit is appropriated according to distribution system between the banks, cooperatives and People's credit fund.
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The Decree also states 05 criteria for performance assessment of State capital in credit institution including: revenue; Net income and net income-to-equity ratio; bad debts and loans classified as loss ratio; Compliance with laws on investment, management and utilization of state capital invested in enterprises, legislation on taxes and other collections paid to the state budget, and legal regulations on financial reporting regime for the purpose of carrying out the financial supervision; Current state of public products and services (if any).
3 . Regulations on orders and procedures of supervision of banks under Circular No. 08/2017/TT-NHNN dated 01/08/2017 by the State bank
4 . Instructions on foreign exchange administration in respect of foreign borrowing and foreign debt repayment of enterprises under Consolidated Circular No. 03/VBHN-NHNN dated 12/07/2017 by the State bank
5 . Regulations on People's credit fund under Consolidated Circular No. 04/VBHN –NHNN dated 17/07/2017 by the State bank
6 . Regulations on safety protection for operation of People's credit funds under Consolidated Circular No. 05/VBHN-NHNN dated 17/07/2017 by the State bank
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