The Ministry of Finance says in a draft proposal that the corporate income tax (CIT) should be slashed to 15%-17% from the current 20% for small- and medium-sized enterprises (SMEs) to support business households wishing to convert themselves into companies. Passers-by walk in front of shophouses. A tax reduction will give much-needed support to SMEs to grow their business and improve their competitiveness at home and abroad The ministry recently released a draft proposal on the development of a National Assembly resolution on a number of CIT policies supporting SMEs. The Government aims to raise the number of businesses to over one million by 2020, 1.5 million by 2025 and two million by 2030. The ministry said that SMEs play a crucial role in Vietnam’s socio-economic development and act as a catalyst for economic growth. It noted that the country has more than 600,000 companies, nearly 500,000 of them in the private sector, with 96% being small or micro sized. Private firms … [Read more...] about Lower corporate income tax sought to stimulate SME development
Income tax evasion
The misconceptions about transfer pricing being a tax avoidance or violation in Viet Nam are creating challenges for multinational enterprises, said Adam Sitkoff, executive director of the American Chamber of Commerce in Viet Nam (Amcham). In his opening speech at a workshop held to gain clarity on the changing world of transfer pricing, he expressed his concerns regarding the widespread perception of transfer pricing as a tool for tax evasion and a violation of laws. He told the workshop held in Hanoi yesterday, that in the context of Viet Nam’s increasing integration into the global economy, transnational transactions would start to become more and more frequent. The misconceptions about these types of transactions would create challenges and barriers for transnational investors when they decide to invest in Viet Nam, Adam said. He stressed that measures should be taken to determine appropriate prices, including tangible and intangible transactions, services, financial or … [Read more...] about Transfer pricing not always tax evasion
China's taxation authorities have fined A-list Chinese movie star Fan Bingbing more than 479 million yuan (US$70 million) over tax evasion and ordered her to pay back more than 255 million yuan in taxes, state news agency Xinhua said on Wednesday (Oct 3). Fan Bingbing has not been seen in public since reports of her involvement in tax evasion surfaced in June. (Photo: AFP/Anne-Christine Poujoulat) The Jiangsu provincial tax bureau delivered its judgments to Fan on Sunday, Xinhua said. The movie star dropped off the radar in June amid reports that she was involved in an investigation into tax evasion in the film industry. Her vanishing act sparked wild speculation in China about her fate, including reports that she had been detained. Fan's troubles began when Cui Yongyuan, a former presenter for state-run China Central Television (CCTV), posted purported contracts online in May that suggested the actress had received under-the-table payments. These agreements are known as … [Read more...] about Actress Fan Bingbing fined US$70 million for tax evasion
Tax experts expect that the cap on interest expense for tax reduction would help prevent transfer pricing and tax evasion - File Photo According to the proposed regulation in the amended draft, the part of interest expense that exceeds 20 percent of the company’s earnings before interest, taxes, depreciation and amortisation (EBITDA) will not be subject to tax deduction. Theo VNA … [Read more...] about New corporate income tax law aims to halt tax evasion
Handing over the right of prosecution and investigation to tax authorities may halt tax evasion? Authorities powerless in face of tax evasion by foreign firms In reality, despite the fact that foreign firms are acquiring massive annual revenue and profit from their operations in Vietnam, the local government faces difficulties in collecting tax from them, as could be seen with the examples of Uber and booking sites Agoda, Booking.com, and Traveloka. A number of these enterprises have been delaying tax payments, while others took advantage of loopholes to evade tax obligations. Notably, in late January 2017, the Ministry of Finance (MoF) asked booking sites that allow tourists to book hotel rooms in Vietnam to calculate and pay VAT and CIT. Targeted websites include Agoda, Traveloka, Booking, and Expedia. The CIT rate is 5 per cent of the total revenue. VAT is calculated on the added value that the companies, called “the foreign contractor” by the ministry, make. MoF … [Read more...] about Extending mandate of tax authorities may halt tax evasion?