No global minimum tax payment for firms in Vietnam until 2025
Businesses in Vietnam will not have to pay the new global minimum tax (GMT) until 2025, says Vu Tuan Anh, a member of the National Assembly’s Finance and Budget Committee.
The lawmaker was speaking at a Thursday press conference of the National Assembly Office held to provide a preview the parliament’s next (sixth) meeting.
Addressing the issue of the parliament not having GMT on the agenda for the coming session, Anh explained that as per the GMT scheme, firms have 12 months to declare any extra corporate income tax (CIT) payments and 18 months after the end of the fiscal year to file returns for taxable incomes.
As a result, firms will not have to pay additional tax per the GMT scheme in their home nations from 2024. The earliest date for firms in Vietnam to pay GMT would be 2025.
With such a timeline, the National Assembly will not discuss GMT content at its next meeting so that it has more time to learn the scheme in detail. The government has been asked to complete draft documents related to GMT, Anh said.
As the GMT is an important and unprecedented scheme, the National Assembly will check it carefully to ensure the country’s tax benefits, attractiveness to foreign investors, competitiveness and compliance with international law and practice, he added.
The GMT, agreed to by G7 countries in June 2021 as a measure to prevent tax avoidance by multinational corporations, will become effective January 1, 2024 in many OECD countries. The GMT under OECD Pillar Two is a once-in-a-lifetime global tax reform that will apply to multinational companies with revenues of EUR750 million ($800 million) or more. Such companies will be subject to a minimum global tax rate of 15%.
In April, Prime Minister Pham Minh Chinh had said that the Vietnamese government will provide non-tax incentives to foreign-invested enterprises to offset any GMT disadvantage.
The PM also said in July that the government would submit GMT resolutions to the National Assembly for approval in October. Minister of Justice Le Thanh Long was tasked with drafting a resolution to add the GMT to the National Assembly’s legislative agenda this year. The Ministry of Finance was asked to draft a report on the GMT implementation and the Ministry of Planning and Investment to draft non-tax support policies for investors to offset losses deriving from the new tax rule.
In order to offset disadvantages arising from deploying the GMT, the government submitted a draft resolution to National Assembly approval, aiming to incentivize high-tech investments.
The draft resolution says that tax breaks or direct subsidy payments from the state budget may be offered for workforce training, investments in fixed assets and public service infrastructure, production of high-tech goods, and research & development (R&D).
On October 17, the National Assembly, Vietnam’s highest legislative body, said it would not discuss approval of GMT at the upcoming session that begins October 23.
Bui Van Cuong, general secretary of the National Assembly, explained that the GMT bill had to be looked at in tandem with another bill that supported high-tech investments, but a draft for the latter was not yet ready for the parliament to discuss and approve.
The upcoming parliament session would have two phases: October 23-November 10; and November 20-November 29. Key topics on the agenda will include a resolution on a pilot scheme to resolve bottlenecks in construction of road traffic projects; the government’s report on the progress made in approving the UK joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP); site clearance and resettlement related to the construction of the Long Thanh International Airport in the southern province of Dong Nai.
The mid-year session will also question top government officials directly; conduct a mid-term review of the nation’s 2021-2025 socioeconomic performance; and carry out a vote of confidence for top officials selected by the National Assembly.
- Read More
Construction trio keen on building $1.5 bln expanded expressway in southern Vietnam
Three construction majors in Vietnam are interested in building an expanded expressway connecting Ho Chi Minh City with the Mekong Delta provinces of Long An and Tien Giang for an estimated VND38.6 trillion ($1.52 billion).
Infrastructure - Tue, November 19, 2024 | 8:18 pm GMT+7
Singapore, Germany upgrade relations to strategic partnership
Singapore and Germany have decided to elevate their ties to a Strategic Partnership to promote closer cooperation in areas of mutual interest such as security, artificial intelligence (AI) and clean energy.
Southeast Asia - Tue, November 19, 2024 | 8:01 pm GMT+7
Thailand’s rice shipment up 20% in 10 months
Thailand exported 8.37 million tons of rice in January-October, a year-on-year increase of 20%, according to the Ministry of Commerce.
Southeast Asia - Tue, November 19, 2024 | 8:00 pm GMT+7
Vietnam’s inconsistent legal framework poses problems for FDI sector: Deep C exec
Vietnam’s legal framework lacks consistency and the foreign direct investment (FDI) sector will soon face challenges related to the Law on Environmental Protection, says Bruno Jaspaert, CEO of Deep C Industrial Zones.
Economy - Tue, November 19, 2024 | 6:30 pm GMT+7
Vietnam shares sink on extended foreign selloffs
Vietnamese equities fell for a fourth consecutive day on Tuesday as foreign traders extended their selling spree.
Finance - Tue, November 19, 2024 | 5:10 pm GMT+7
Germany’s household product firm QuickPack to invest $32 mln in Vietnam
Germany’s QuickPack, a specialist for household goods and hygiene products, will invest €30 million ($31.8 million) in Vietnam’s Mekong Delta province of Long An.
Industries - Tue, November 19, 2024 | 4:24 pm GMT+7
Malaysian millionaire willing to invest in convicted Vietnamese tycoon’s property project: lawyers
Malaysian millionaire Vincent Tan has evinced investment interest in a residential project owned by convicted tycoon Truong My Lan, chairwoman of Van Thinh Phat Group, lawyers for the latter have disclosed.
Real Estate - Tue, November 19, 2024 | 4:17 pm GMT+7
‘Bottleneck of bottlenecks’ continues to dog Vietnam's property, infrastructure projects
Limited consultations between state agencies and the parliament’s primary focus on wording are issues with Vietnam’s legal framework adversely affecting property and infrastructure projects, say experts and corporate leaders.
Economy - Tue, November 19, 2024 | 3:40 pm GMT+7
President Xi Jinping hastens construction of 3 Vietnam-China rail routes
Chinese President Xi Jinping has called for more substantial cooperation between China and Vietnam, including the pacier implementation of three railway routes linking the two nations.
Infrastructure - Tue, November 19, 2024 | 3:08 pm GMT+7
Vietnam developers offer deferred principal payments, interest support to boost year-end sales
Vietnamese housing developers are offering several incentives including deferred principal payments and interest support to stimulate demand and boost liquidity as the year nears its end.
Real Estate - Tue, November 19, 2024 | 2:29 pm GMT+7
Australia's EQ Resources acquires TMG Group with Vietnam-based ferrotungsten factory
Australia-based EQ Resources Limited has acquired its fellow firm Tungsten Metals Group (TMG), which owns and operates the largest ferrotungsten (FeW) factory outside China.
Companies - Tue, November 19, 2024 | 11:00 am GMT+7
Techcom Securities becomes largest broker in Vietnam by capital base
Techcom Securities JSC (TCBS) has become the largest securities company in Vietnam by charter capital after finishing a rights offering last week.
Finance - Tue, November 19, 2024 | 9:11 am GMT+7
Vietnam airport operator ACV looks to better exploit non-aviation service potential: exec
Vietnam's airports operator ACV expects to earn $145 million from non-aviation services this year, accounting for around 18.83% of its total revenue, which is modest compared to other countries, said deputy general director Nguyen Duc Hung.
Companies - Tue, November 19, 2024 | 7:45 am GMT+7
The Investor to host seminar on removing legal bottlenecks for infrastructure, property investment
A seminar themed “Removing legal bottlenecks for infrastructure and property investment” will be organized by The Investor in Hanoi on Tuesday.
Companies - Tue, November 19, 2024 | 7:00 am GMT+7
Indonesia promises Asia-Pacific investors more incentives
Indonesian President Prabowo Subianto recently told the press that he will create more incentives and expand special economic zones (SEZs) so as to lure investors from Asia-Pacific.
Southeast Asia - Mon, November 18, 2024 | 11:01 pm GMT+7
Indonesia, Brazil enhance aviation cooperation
Indonesia's state-owned aircraft manufacturer, Dirgantara Indonesia (DI), and Brazilian aerospace company Embraer have signed a memorandum of understanding (MoU) to expand collaboration in the commercial aviation sector.
Southeast Asia - Mon, November 18, 2024 | 11:00 pm GMT+7