Legal updates

Accordingly, in order to implement Article 4 of Decree No. 145/2020/ND-CP of the Ho Chi Minh Department of Labour, War Invalids and Social Affairs guiding the implementation of the report on the use of labor, as follows:

1.Subjects of the report: Enterprises, agencies and organizations that employ employees and have their headquarters and operating locations in Ho Chi Minh City (hereinafter referred to as units).

From July 1, 2023, the basic salary applied to state officials and public employees will be increased from 1,490,000 to 1,800,000 VND/month.

Accordingly, the ceiling for payment of social insurance and health insurance (equal to 20 times the basic monthly salary) will increase from 29,800,000 to 36,000,000 VND/month.

Accordingly, the Tax Department guides the case that the Company in Vietnam signs a warehouse lease contract with another company in the US, the cost of renting the warehouse is included in the deductible cost when determining the corporate income taxable income if it meets the conditions specified in Article 4 of Circular No. 96/2015/TT-BTC.

Accordingly, in case an enterprise is subject to the application of Decree 92/2021/ND-CP and completes the conversion of the financial reporting period from 01/01-31/12to the reporting period from 01/10-30/09, the tax amount shall be reduced according to Decree 92/2021/ND-CP applicable to the corporate income tax period from 01/01/2021 – 30/09/2021.

Pursuant to the provisions of Clause 1, Article 3 of Decree No. 126/2020/ND-CP and Article 4 of Circular No. 96/2015/TT-BTC regulating deductible and non-deductible expenses when determining taxable income.

The Department of Business Registration Management receives feedback from a number of business registration agencies and enterprises on the receipt of the notice of the tax authority requesting: no later than March 31, 2023, the enterprise must complete the procedure to update the citizen’s identity card with a chip for the legal representative on the enterprise registration certificate; past the above time limit, the enterprise will be sanctioned for administrative violations.

Accordingly, in order to stimulate consumption demand, recovery and economic development, if the case of 2% reduction for goods and services is subject to the tax rate of 10% (remaining 8%) according to the following options:

Option 1: Reduce the VAT rate by 2% for the group of goods and services subject to the tax rate of 10% (down to 8%).

Accordingly, the General Department of Taxation instructs that in case the Company has goods and services used for promotion, advertising, donation, internal consumption, the value-added tax paid under the deduction method is not deductible expense when determining taxable income.

In case Google – an overseas supplier has registered, filed and paid taxes directly in Vietnam according to the provisions of Article 76, Article 77, Article 78, Article 79 of Circular No. 80/2021/TT-BTC, the Company is not obliged to declare, deduct, and pay taxes on behalf of the overseas supplier as prescribed in Circular No. 103/2014/TT-BTC dated August 6, 2014 of the Ministry of Finance.

In case the provision of services takes place both in Vietnam and outside Vietnam but the service contract is signed between two taxpayers in Vietnam or has a permanent establishment in Vietnam, the 0% tax rate only applies to the value of services performed outside Vietnam as prescribed in Clause 1, Article 9 of Circular No. 219/2013/TT-BTC dated December 31, 2013 of the Ministry of Finance.