Tax cut proposal to assist individuals, businesses

The Government today will submit the National Assembly a draft tax law proposing a reduction of VND5,600-5,700 billion taxes for businesses and individuals by next year.
 
The Government proposes tax reduction for businesses, individuals (Photo: SGGP)
The 17 clause draft law proposes to remove the caps on advertising costs, give business income tax incentives to those in priority fields, free tax payers from their debts and propose measures on tax and customs procedure reform.
 
Enterprises investing in agriculture and rural development fields will enjoy 20 percent income tax rate in 2014 and 2015 &17 percent from 2016.
 
Businesses in support industry and projects with capital totaling up to VND12 trillion (US$565 million) will enjoy 10 percent tax rate in 15 years, tax exemption in four years and 50 percent tax reduction in nine following years.
 
The Government proposes not to impose business income tax to abroad investment projects.
 
The caps on advertisement and marketing costs should be removed. Otherwise the 15 percent cap should be applied on advertising only not marketing and brokerage.
 
Boat owners, crew members and those winning lottery in casinos should be exempt from personal income tax.
 
Those selling their properties should be permitted to choose two tax payment methods including 25 percent of their income or 2 percent of selling price. Stock traders would be able to pay 20 percent annual income in taxes or 0.1 percent of stock selling prices.
 
Five percent value added tax (VAT) on fertilizer and feed should be abolished. Input VAT should be completely deducted for private investment in education, vocational training, health, culture, sports, environment and shipbuilding.
 
The Government proposes to remove excise tax regulation and not to charge natural resource tax on natural waters used for agriculture, aquaculture and forestry.
 
The NA should lift penalties to late payment of tax debts before July 1 last year for those whose partners have gone bankruptcy and who have suffered high interest rate. However, they must pay their debts before December this year to enjoy this policy.
 
If the draft law is passed, deducted taxes for individuals and businesses will total VND5,600-5,700 billion (US$263.47-268.17 million) in 2015, according to calculations by the Ministry of Finance. The Government will have to spend VND1,300 billion (US$61.16 million) for VAT refund.
 
However, the Government income source will be compensated with increasing special income tax on cigarettes, wine, beer, casino business and online games. It is estimated to raise VND896 billion in 2015, VND3,598 billion in 2016, VND5,341 billon in 2017, VND7,525 billion in 2018 and VND10,566 billion in 2019.
 
Today - November 3, the National Assembly will begin the third working week of the 8th session.

By Ham Yen – Translated by Hai Mien

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