Expanding preferential treatment for subjects directly affected by Covid-19

VCN - Over the weekend, the Ministry of Finance submitted to the Government a draft decree on tax and land rent extension for businesses, organisations, individuals and business households directly affected by the Covid-19 pandemic.

expanding preferential treatment for subjects directly affected by covid 19 Wood firms seek new market channels amid COVID-19
expanding preferential treatment for subjects directly affected by covid 19 Vietnam, RoK share experience in combating COVID-19
expanding preferential treatment for subjects directly affected by covid 19 Excess inventories and COVID-19 lead to significant price drops for tuna
expanding preferential treatment for subjects directly affected by covid 19
Steps and procedures for drafting a decree to extend tax and land rents to support businesses, organisations, individuals and business households directly affected by Covid-19. Photo: H.V.

Extension of corporate income tax

Following the Prime Minister's directive, the Ministry of Finance has urgently prepared a draft decree to extend tax and land rent payment deadlines to support businesses, organisations, individuals and business households directly affected by Covid-19. Based on the comments, the Ministry of Finance completed and officially submitted to the Government on March 26.

In terms of beneficiaries, compared to the previous draft, basically, the three groups of beneficiaries of this support package remained the same, but after a field study, the Ministry of Finance proposed adding several industries which are not manufacturing or services but are also directly affected by the Covid-19 epidemic, includingeducation - training, health care, art creation, entertainment, sports and recreation.

In terms ofpreferential policies, the Ministry of Finance continues to propose extension of the tax payment time limit for arising Value Added Tax (VAT) amounts payable in the tax periods of March, April, May and June, 2020 (for cases of monthly VAT declaration) and the tax period of the first and second quarter of 2020 (for quarterly VAT declaration) of the above-said enterprises and organisations. The extension is fivemonths from the end of the deadline for paying VAT in accordance with the regulations of law on tax administration. This offer will not apply to VAT forthe import stage.

New in the official draft is the Corporate Income Tax (CIT) incentive, extending the tax payment deadline for the remaining CIT payable according to the balance sheet of 2019 but not yet paid into the State budget. The State budget and the provisional corporate income tax (CIT) of the first quarter, second quarter of 2020 of enterprises and organizations mentioned above. The extension is also fivemonths from the end of the deadline for paying CIT in accordance with the law on tax administration.

For business households and individuals, besides asking for an extension of the deadline for paying VAT as in the previous draft, the Ministry of Finance proposes extending Personal Income Tax (PIT) for tax amount to be paid in 2020 by households and individuals doing business in the above-mentioned economic sectors. Business households and individuals shall pay the deferred tax amount in this clause before December 15, 2020.

Along with that, the Ministry of Finance also proposes to extend the land rental payment term for the amount of land rent to be paid in the first period of 2020 of enterprises, organizations and individuals directly leased land by the State under the decision of competent State agencies in the form of annual land rent payment, which on the decisions and land lease contracts for production and business purposes in the above-mentioned economic sectors.

Particularly for small and micro enterprises, the entire land rent payable for the first period of 2020 of the enterprise will be extended. The grace period is fivemonths from 31 May, 2020.

In case an enterprise, organisation, household or individual engages in production and business activities of various economic sectors, including economic sectors subject to the extension, such enterprises or organizations may participate in the extension the whole time of the VAT amount, the payable EIT amount; business households and individuals are allowed to extend all payable VAT and PIT.

Support package is more than80 trillion VND

According to the Ministry of Finance, the five-month VAT payment deadline for VAT payable from March to June 2020 will reduce approximately VND 61,600 billion of those State revenues. Similarly, the extension of the tax payment deadline for CIT payable after the 2019 tax finalisationis estimated by tax authorities to be extended about VND 11,100 billion. For business households and individuals, the group's 2019 tax amount to be extended is about VND 3,000 billion. In addition, estimated land rent extension is about 4,500 billion VND and businesses, households and business individuals must submit to the State budget before October 31, 2020.

Pham DinhThi - Director of Tax Policy Department, Ministry of Finance said because of expanding the subjects and adding extensions to the payable CIT in 2019, the total number of extensions will be more thanVND 80 trillion instead of 30 trillion VND as the first draft. The extension will reduce the State budget revenue in the extended months but this amount will be remitted by the end of 2020 so overall, does not affect the budget revenue for the whole 2020.

Thi also said the Ministry of Finance is asking the Government to immediately apply the policy when the Decree is signed. Therefore, businesses, organisations, individuals and business households must pay attention to determine exactly whether they are included in the extended subjects or not to send requests to tax offices. On the basis of the application, the tax office will make an extension for the subjects. In addition, according to the representative of the Ministry of Finance, this draft proposal proposes to extend the finalized corporate income tax of 2019. According to the Law on Tax Administration, this tax must be declared and settled after 90 days from the date of submission since the end of the year. Therefore, businesses must grasp this spirit, waiting for the official decision of the Government; businesses will be extended fivemonths. For enterprises which are subject to the extension of the enterprise income tax which have been finalised and paid already, it will be deducted from other taxes to the State budget.

By Hong Van/ HuuTuc

Related News

Risks for the economy when cash flow has not yet been put in to production and business

Risks for the economy when cash flow has not yet been put in to production and business

VCN - Investment channels in Vietnam have a lot of potential, but financial and banking expert Dr. Nguyen Tri Hieu, Director of the Institute for Research and Development of Global Financial and Real Estate Markets, said that cash flow into production and business is still modest, leading to risks for the economy.
Mobilizing finance for the low-emission rice value chain

Mobilizing finance for the low-emission rice value chain

VCN - Currently, capital remains the biggest difficulty for cooperatives and rice production enterprises, especially those participating in the high-quality, low-emission rice project in the Mekong Delta. This requires strong participation from banks, investment funds and international financial institutions.
Anti-corruption in Finance: Resolutely eliminating cumbersome administrative procedures

Anti-corruption in Finance: Resolutely eliminating cumbersome administrative procedures

VCN - The Ministry of Finance identifies administrative reform and simplification of regulations related to business activities as key solutions for preventing and combating corruption and negativity.
Vietnam made good progress in reforming public financial management

Vietnam made good progress in reforming public financial management

VCN - Vietnam has made many efforts to reform public financial management in the past 10 years and has made comprehensive progress. This is the opinion of Deputy Minister of Finance Bui Van Khang at the Conference to announce Public Expenditure and Financial Accountability (PEFA) organized by the Ministry of Finance on the morning of June 24.

Latest News

"One law amending four laws" on investment to decentralize and ease business challenges

"One law amending four laws" on investment to decentralize and ease business challenges

VCN - According to the Government, the draft Law amending and supplementing certain provisions of the Planning Law, Investment Law, Law on Investment under Public-Private Partnerships (PPP), and Bidding Law (referred to as "One law amending four laws") focuses on amending conflicting regulations that are causing obstacles, to facilitate investment, production, and business activities.
One law amending seven financial laws: New driving force for economic growth

One law amending seven financial laws: New driving force for economic growth

VCN - Draft 1 of the Law amending 7 laws in the financial sector has been officially submitted and discussed at the 8th session of the 15th National Assembly. According to the Law-making program, the Law will be developed and promulgated following a simplified procedure and will be approved at this session. The simultaneous amendment of many provisions in the laws in the financial sector and their early approval demonstrate the determination and great efforts of the National Assembly, the Government, and the Ministry of Finance in creating a system of open and appropriate policies, promoting investment resources in the economy, thereby promoting economic growth in the new period.
Ensure harmony of interests of “3 parties” when applying 5% VAT on fertilizers

Ensure harmony of interests of “3 parties” when applying 5% VAT on fertilizers

VCN - In the short term, applying 5% VAT on fertilizers may increase selling prices, but in the long term, farmers will benefit from this policy. When the fertilizer manufacture is deducted input tax, it will help reduce investment cost and production cost.
Tax, fee, and land rent exemption, reduction, and deferral policies: a driving force for business recovery and growth

Tax, fee, and land rent exemption, reduction, and deferral policies: a driving force for business recovery and growth

Recently, the implementation of a series of policies on tax, fee, and land rent exemption, reduction, and deferral has provided timely support for businesses to recover and develop, thereby making positive contributions to economic growth.

More News

Revamping commodity management and trade protection

Revamping commodity management and trade protection

VCN - Completing commodity management policies combined with applying trade defense measures plays an important role in protecting the interests of businesses and the Vietnamese economy. Close coordination between management agencies not only helps prevent trade fraud but also creates favorable conditions for exporting businesses, minimizing risks from anti-dumping lawsuits.
Tax support policy is a "lift" for business bounceback

Tax support policy is a "lift" for business bounceback

VCN- Sharing with Customs Magazine, economic expert, Associate Professor, Dr. Dinh Trong Thinh highly appreciated the effectiveness of tax and fee reduction measures implemented by the Government and the Ministry of Finance. These policies not only enable businesses to reduce input costs and increase profits, but also promote consumption and production of businesses.
VAT policy for on-the-spot imports

VAT policy for on-the-spot imports

VCN- The General Department of Vietnam Customs has instructed Dong Nai Food Industry Corporation on VAT policy for imported tobacco leaves separated from stems.
Applying tax on animal feed ingredient faces problems due to specialized regulations

Applying tax on animal feed ingredient faces problems due to specialized regulations

VCN - The unified application of regulations of specialized legal documents related to value-added tax (VAT) policies on imported raw materials for animal feed has caused many problems. Notably, the accurate identification for imported raw materials for animal feed not only causes difficulties for the enterprise but also for the enforcement authority.
Ministry of Finance proposes to choose the option of reducing land rent by 30% in 2024

Ministry of Finance proposes to choose the option of reducing land rent by 30% in 2024

VCN - The Ministry of Finance has just completed the draft Decree of the Government regulating the reduction of land rent in 2024. Accordingly, in the latest Draft, the Ministry of Finance directly proposed to choose the reduction level according to option 2 of 30%.
Ensuring reasonableness upon enforcement of regulations in "1 law amending 7 laws"

Ensuring reasonableness upon enforcement of regulations in "1 law amending 7 laws"

VCN - According to the representative of the Vietnam Chamber of Commerce and Industry (VCCI), the Ministry of Finance and the National Assembly Committees are urgently collecting opinions to complete the draft Law amending seven Laws, to ensure that the issued regulations are reasonable and remove difficulties for businesses.
Ensuring global trade security requires cooperation, exchange and processing of information before the goods arrive

Ensuring global trade security requires cooperation, exchange and processing of information before the goods arrive

VCN - As import and export activities increase, security risks also increase. Therefore, to meet the requirements of both strict security control and shortening clearance time, facilitating trade, one of the effective solutions is to cooperate, exchange and process information before the goods arrive.
New regulations on foreign indirect investment in Vietnam drafted

New regulations on foreign indirect investment in Vietnam drafted

The State Bank of Vietnam (SBV) is drafting a circular to better manage foreign investment protocols and hopefully make them speedier.
Considering amending regulations on suspension from exit due to tax arrears

Considering amending regulations on suspension from exit due to tax arrears

VCN - To facilitate the implementation of suspension from exit, the General Department of Taxation directs specialized units to study and amend and supplement current regulations to ensure both improving the efficiency of tax debt collection and creating conditions for enterprises and taxpayers to develop stable production and business as well as facilitate travel and trade activities.
Read More

Your care

Latest Most read
"One law amending four laws" on investment to decentralize and ease business challenges

"One law amending four laws" on investment to decentralize and ease business challenges

VCN - According to the Government, the draft Law amending and supplementing certain provisions of the Planning Law, Investment Law, Law on Investment under Public-Private Partnerships (PPP), and Bidding Law (referred to as "One law amending four laws") fo
One law amending seven financial laws: New driving force for economic growth

One law amending seven financial laws: New driving force for economic growth

VCN - Draft 1 of the Law amending 7 laws in the financial sector has been officially submitted and discussed at the 8th session of the 15th National Assembly. According to the Law-making program, the Law will be developed and promulgated following a simpl
Ensure harmony of interests of “3 parties” when applying 5% VAT on fertilizers

Ensure harmony of interests of “3 parties” when applying 5% VAT on fertilizers

VCN - The representative of the Vietnam Fertilizer Association cites data from the Ministry of Finance, as saying that about VND10,000 billion of VAT has not been deducted from business expenses from 2015 to present.
Tax, fee, and land rent exemption, reduction, and deferral policies: a driving force for business recovery and growth

Tax, fee, and land rent exemption, reduction, and deferral policies: a driving force for business recovery and growth

Recently, the implementation of a series of policies on tax, fee, and land rent exemption, reduction, and deferral has provided timely support for businesses to recover and develop, thereby making positive contributions to economic growth.
Revamping commodity management and trade protection

Revamping commodity management and trade protection

Completing commodity management policies combined with applying trade defense measures plays an important role in protecting the interests of businesses and the Vietnamese economy.
Mobile Version