Technical Update - Legal Update
Our legal update would cover the following matters:
— New Law amending a number of laws including, but not limited to, Law on Investment, Law on Electricity and Law on Enterprises
— New regulations on management of e-commerce websites and e-commerce activities via mobile applications in cellphone devices
Tax Alert - Draft decree amending Decree 126/2020/ND-CP and Decree 123/2020/ND-CP
In order to create favorable conditions for tax declaration and remove difficulties in paying provisional Corporate Income Tax (“CIT”), the Ministry of Finance has prepared a draft Decree to submit to the Government which amends and supplements a number of articles of Decree 126/2020/ND-CP and Decree 123/2020/ND-CP. Notably, the Draft Decree proposes that the provisional CIT payment for the four quarters of a taxpayer must not be less than 80% of the total CIT liability of the annual CIT finalization. Currently, Decree 126/2020 requires the provisional CIT for the first three quarters to account for at least 75% of the annual CIT liability.
Alert on immigration February 2022
The recent relaxation in entry permit, visa and quarantine regulations for foreigners entering Vietnam is promising and should result in increasing mobility for business travelers, investors and those coming to work longer term in Vietnam. However, when COVID-19 is well controlled, some regulations which were issued to support businesses and foreigners during the COVID-19 pandemic may be removed and the immigration requirements for foreigners revert back to pre-pandemic norm. This in-turn may cause issues for businesses to recruit and maintain a suitable foreign labour force in Vietnam.
On 06 January 2022, the Government of Vietnam issued Decree No. 02/2022/ND-CP guiding the Law on Real estate business 2014 (“Decree 02”). Decree 02 will come into force on 01 March 2022 and have significant impacts on the business of real estate enterprises.
To enforce the collection of compulsory insurance contributions and enhance the tax administration, on 09 July 2021, the General Department of Taxation (“GDT”) and the Vietnam Social Insurance Authority signed a Regulation on data sharing and coordination No. 1999/QCPH-BHXH-TCT. On 06 December 2021, the GDT issued Official Letter
No. 4740/TCT-DNNCN guiding local tax departments on the implementation of the coordination mechanism. It is expected that tax and social insurance authorities will have stricter monitoring and more joint audits/inspections in the coming time.
On 9th February 2022 in Paris Vietnam joined the Signing Ceremony of the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (“MLI”).
Following the Resolution No. 43/2022/QH15, on 28 January 2022, the Government issued Decree 15/2022/ND-CP guiding the implementation of the tax relief measures relating to the VAT reduction and CIT deductibility for Covid-19 donation and sponsorship expenses. Accordingly, the VAT for the goods and services which are currently subject to the rate of 10% to 8%, applicable from 1 February 2022 to 31 December 2022.
Our legal update would cover the following matters:
— New regulations on the business of electronic gaming with prizes for foreigners
— New regulations on penalties for administrative offences in planning and investment sector
— New regulations on working hours and resting hours applicable to employees doing seasonal production work and processing works under orders
Alert on removal of entry permit requirement for foreigners
On 18 January 2022, Standing Deputy Prime Minister Pham Binh Minh approved to remove entry permit requirement for foreigners and Vietnamese overseas, who already have valid permanent cards, visa, temporary resident cards or visa exemption. Please refer to our Alert on the Official letter 405/VPCP-QHQT for more information on the cease of entry permit.
Tax and Legal Update January 2022
KPMG would like to share the very recent update on the tax and legal legislation for your reference
According to Decree No. 07/2016/ND-CP dated 25th January 2016 of the Government (“Decree 07”) guiding
the Commercial Law on representative offices of foreign entities (“RO”) in Vietnam, ROs are required to
submit an annual operation report (“Annual Report”) to the provincial Department of Industry and Trade
no later than 30th January of the following year.
The General Department of Taxation (“GDT”) issued the Official Letter No. 4110 dated October 27, 2021 on the tax treatment related to Covid-19 expenses (“OL 4110”). According to OL4110, the GDT lists out a number of expense items that shall not be taken into account for PIT calculation of the employees whilst being deductible for Corporate Income Tax (“CIT”) if the expenses are incurred and are supported by legitimate supporting documents,
It is necessary to start implementing the compulsory SI policy for foreign employees to help ensure their
rights and obligations while working in Vietnam and to level the playing field with respect to local hires. The
scheme allows the participants to enjoybenefits from the SI fund, when eligible.
On 14th December 2021, the Social Insurance Agreement (“the SIA”) between Vietnam and Korea was
signed by the Minister of Labour, War Invalids and Social Affairs (Vietnam) and the Minister of Health and
Welfare (Korea) on behalf of the Governments of the two countries.
On 16th December 2021, the Ministry of Health issued Official letter No. 10688/BYT-MT to other relevant Ministries and Provincial People Committees to give guidance on implementation of Covid-19 preventive measures for passengers who enter Vietnam from 01st January 2022.
Technical Update November 2021
On 8 November 2021, the Government enacted Decree No. 98/2021/ND-CP on management of medical devices (“Decree 98”). Decree 98 will come into effect on 1 January 2022 and replace Decree No. 36/2016/ ND-CP dated 15 May 2016 (amended by Decree No. 169/2018/ND-CP and Decree No. 03/2020/ND-CP) (“Decree 36”).
The Draft Decree amending Decree 111 (Decree guiding the development of supporting industries ("SI") ) with the aim to clarify some regulations on determination of SI incentives, expanding the list of SI products, and also adding more criteria for permission of SI incentive.
In our latest October release, we would like to share the very recent update on legal legislation. This includes the Draft Law altering and supplementing a number of articles of Law on Intellectual Property, the Draft Decree on penalties against administrative violations in cybersecurity, as well as the guidelines on Law o Real Estate Trading 2014
On 25 September 2021, the Government of Vietnam issued Decree No. 85/2021/ND-CP, which takes effect on 1 January 2022. In this release, we would like to summary various key changes to the e-commerce platforms and activities in Vietnam in this Decree 85 for your information.
KPMG to underline new changes to the Advanced Pricing Agreement (“APA”) program, comments from the
General Department of Taxation ("GDT") on the reasons for the new points of Circular 45 and our insights from a professional perspective.
In this release, KPMG highlights some notable changes in respect of the tax payment allocation mechanism, principles of tax declaration and tax administration related to Circular 80.
On 29 September 2021, the Ministry of Finance has issued Circular 80/2021/TT-BTC. The Circular provides guidance on general tax administration and for foreign e-commerce businesses without a permanent establishment in Vietnam but have income arising in Vietnam.
Tax & Legal Update September 2021
Immigration Alert September 2021
Transfer Pricing Alert June 2021
Tax Alert (2) June 2021 - Decree 57
Tax Alert June 2021 - Circular 40
Immigration Alert (2) May 2021
Immigration Alert (1) May 2021
(Case study | VN Version)
Immigration Alert (2) January 2021
Immigration Alert (1) January 2021