Law amended to reduce corporate income tax

The Ministry of Finance has made amendments to the law on corporate income tax, reducing the level from 25 percent to 23 percent and for print newspapers to enjoy preferential tax rate of only 10 percent.

Young readers at the Spring Newspaper Festival in the Youth Cultural House in HCMC (Photo: SGGP)

Corporate income tax will decrease from the current level of 25 percent to 23 percent which will also bring down the State budget income by VND12,064 billion (US$579 million).

For medium and small enterprises with less than 200 employees and an annual income not exceeding VND20 billion ($960,000), the tax rate will be 20 percent.

Because of an urgent demand for social housing, these projects will pay a preferential rate of 10 percent without further reduction or exemption.

Notably, publishing and print newspapers will enjoy a tax rate of 10 percent only.

According to the law, newspapers are a cultural item which not only operate for profit but also carry out political missions tasked by the Party and State.

Print newspapers have suffered losses and have had to compensate income from advertisements. In 2011, they suffered losses in both publishing and advertising.

The 10 percent tax rate on publishing and print newspapers will help them resolve some of their difficulties so as to continue to carry out   political tasks.

Income from other activities of newspaper agencies like real estate,   event management and hotel and tourism businesses will have to pay 23 percent tax.

Other media channels like television, broadcasting and e-newspapers are not covered by the preferential tax rate of the new amended law as they face less difficulty than print newspapers.

By Ngoc Quang – Translated by Hai Mien

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