New rates of license tax in 2017

Licenses tax will be collected from January 1st 2017. Photo: H.V

Accordingly, the rate of collecting licenses tax for organizations that have production activity, trading goods and services that have charter capital or invested capital over 10 billion VND, is 3 million VND/year; companies with charter capital or invested capital under 10 billion VND will be 2 million VND/year; branches, representative offices, places of business and other economic organizations will pay 1 million/year.

The license fee for organizations in this paragraph is based on the charter capital stated in the business registration certificate or written in the bylaws of the co-operative. If they don’t have charter capital, it will be based on the investment registration certificate or written decision of investment policy.

In the case where the charter capital or invested capital is written in the business registration certificate or investment registration certificate in foreign currency, it will be converted to Vietnam Dong in order to establish the foundation for determining the rate of license fees according to the bank buying rate of commercial bank or credit institutions where payers opened their account at the point of time they paid license fees into the State Budget.

Furthermore, license fee rates for individuals, groups of individuals, households having production activities, or trading in goods and services that have sales revenue of over 500 million vnd/year, is 1 million vnd/year; sales revenue from 300 to 500 million/year will be charged 500,000/year; sales revenue is from 100 to 300 million vnd/year will be charged 300,000 VND/ year.

Additionally, the revenue to make a basis for determining the rates of licenses fees for individuals, groups of individuals, households in this paragraph is the total revenue from personal income tax calculation.

For individuals or groups of individuals, households having a change in revenue, the basis for determining the license fee rates is the total revenue of personal income tax calculation of the preceding year.

Individuals or groups of individuals, households which have new business operations in the year will take the total revenue rate of the year as the basis for determining the license fees rate.

Organizations, individuals, groups of individuals, production households and trading or new establishment that were granted tax registration and tax code, and business code during the first 6 months of the year, will pay a license fees rate for the whole year; if they are established and granted tax registration and tax code, business code during the last 6 months of the year, they will pay 50% of the license fee for the year.

Organizations, individuals, groups of individuals, production households trading without license fee declaration, shall pay a license fee for the whole year, regardless of the time of detection.

Organizations, individuals, groups of individuals, production households and trading that have informed to the tax authorities about business suspension in the whole year, don’t have to paid license fees of that year. In the case of incomplete business suspension in the year, they have to pay the license fee for the year.

The deadline for license fees payment is on 30^th January annually. In the case of organizations with new production activities or new production base establishment, the deadline to pay licenses fee is the deadline to lodge licenses fee declaration document.

The Circular takes effect from January 1^st 2017 and repeals Article 17 of Circular 156/2013/TT-BTC of the Ministry of Finance about guiding to implement some articles of Tax Administration Law; Law of Amending and supplementing some articles of the Tax Administration Law and Decree No. 83/2013/ND-CP of the Government.

The contents of this circular also replaces some Circulars: No. 96/2002/TT-BTC of the Ministry of Finance about guiding to implement Decree No. 75/2002/ND-CP of the Government on the adjustment of license tax rates ; No. 113/2002/TT-BTC of the Ministry of Finance about guidance to supplement Circular No. 96/2002/TT-BTC of the Ministry of Finance; No. 42/2003/TT-BTC of the Ministry of Finance about guidance to adjust and supplement Circular No. 96/2002/TT-BTC.

Earlier, the National Assembly passed the Law on Fees and charges. License taxes are included in the list of fees and are called license fees, and applies from January 1^st 2017.