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Vietnam: Business households and individuals expected to enjoy 50% tax reduction
Under the new support package that the Ministry of Finance is working on, all business households and individuals would enjoy a 50% reduction in payable tax arising from production and business activities in the third and fourth quarters of 2021.
Nguyen Quoc Hung, Director of the Tax Policy Department of the Ministry of Finance, said that the Ministry of Finance is developing a scenario to reduce and relax taxes for businesses in the second half of 2021 according to the National Assembly’s Resolution on assisting epidemic-affected businesses.
Specifically, it is expected to reduce 30% of corporate income tax payable this year for businesses and organizations as applied to 2020, applicable to enterprises with annual revenue not exceeding VND200 billion.
In particular, it plans a reduction of 50% of payable tax amounts arising from production and business activities in the third and fourth quarters of this year for business households and individuals doing business in all fields, all locations, all forms of tax declaration and tax payment.
The Ministry of Finance is also considering reducing the value-added tax rate by 30% for businesses and organizations operating in a number of service sectors.
In addition, the Ministry of Finance may apply the policy of exempting late payment interest arising in 2020 and 2021 (2 years affected by the Covid-19 epidemic) for businesses and organizations that incurred continuous losses in the years 2018, 2019, and 2020.
According to the Ministry of Finance’s estimate, the implementation of solutions proposed in this draft may reduce budget revenue by about VND20,000 billion.
In addition to the proposal to reduce direct tax obligations for businesses, the Ministry of Finance is also studying a solution to reduce land rent for 2021.
Hung said, overall, the solutions that have been implemented by the National Assembly Standing Committee, the Government and the Ministry of Finance since early 2021 and the additional proposed solutions mentioned above, the amount of support for businesses and people in 2021, is about VND138,000 billion. Of the number, the package of extension, exemption and reduction of taxes, fees, charges and land rent issued totals about VND118,000 billion.
In 2020, the Ministry of Finance proposed extending the time for paying tax and land rent; and exemption or reduction of taxes, fees, charges and land rents, worth about VND 29,000 billion.
Anh Tuan
Source: https://vietnamnet.vn/en/business/business-households-and-individuals-expected-to-enjoy-50-tax-reduction-762568.html