Vietnam to amend tax laws (29/01)
06/08/2010 - 35 Lượt xem
According to the Ministry of Finance, the currently applied CIT law has several shortcomings behind prolonged arguments between taxation bodies and enterprises. For example, several business expense categories are not accepted by tax agencies.
The current CIT law, which replaced the turnover tax, became effective as of January 1, 1999. It was previously amended in 2004 to minimize discriminatory treatment of both foreign and domestic investment.
However, Associate Prof. Bach Thi Minh Huyen, former Deputy Director of the Tax Policy Department under the Ministry of Finance, asserted the law has revealed several shortcomings in its eight years, especially in regard to tax rates.
The single tax rate of 28% is being imposed on enterprises and is expected to be amended.
As for the VAT law, MOF is planning to give detailed provisions on the subjects of VAT, while retaining three tax rates of 0%, 5% and 10%. However, ministries have expressed contradictory viewpoints about the rates. Some think that a single rate of 10% should be applied instead of three different rates.
MOF is also considering amending the luxury tax law. Currently, luxury tax is imposed on three product categories, cars, tobacco and alcohol.
The luxury tax law was amended on January 1, 2006, when the Government decided that domestic and foreign made products will bear the same rate, 30% has been imposed on beer.
As for domestically produced vehicles, the current rate is 50% for less-than-five-seat cars, 30% for 6-15-seat and 15% for 16-24-seat vehicles.
The amendment has helped the state increase its luxury tax collection. It is estimated that the state raked in VND217.8bil ($13.61mil) more from the raised luxury tax on imported cars.
Source: VNE
