ECOVIS Focus Hong Kong

Portugal’s new tax measures: State budget for 2025

18.12.2024

The Portuguese state budget includes some new tax measures. These include the exemption of income tax for young people and the gradual reduction of corporate tax for companies. The Ecovis experts explain the details of the 2025 state budget.

The 2025 budget has been approved in general. However, it must still pass through two more phases before approval:

• A discussion about specific aspects that the opposition may want to see altered.
• The vote on the final version. This is expected to be very similar to the current one.

The budget will result in new benefits and opportunities within the tax landscape and includes a few notable tax measures concerning both individuals and companies.

Financial relief for young people and individuals

The most significant policy in terms of personal income tax is the planned exemption for young people. It foresees that income from employment and self-employed work earned by a person up to the age of 35, who is not considered a dependent, will be partially exempt from personal income tax for the first 10 years of work. The exemption is limited to €28,009.03 and will apply as follows (with a few exceptions):

• No income tax in the 1st year of work
• A tax exemption of 75% in the 2nd to the 4th year
• A tax exemption of 50% in the 5th to the 7th year
• A tax exemption of 25% in the 8th to the 10th year

With the reduction in corporate tax, Portugal is becoming even more attractive for foreign investors.

Eloísa Ribeiro Santos, Partner, RBMS – Member of ECOVIS International, Lisbon, Portugal

These measures are aimed at incentivising young people to stay in Portugal and attracting even more young people from other countries.

In another planned measure, company owners will be allowed to deduct 20% of the capital invested in their companies from their personal income tax.

Corporate tax cut to boost economic growth

In corporate income tax, the leading policy next year is the beginning of a gradual decrease in the tax rates for the first time in over a decade. According to the current version of the state budget, the tax rate applicable to the first EUR 50,000 of taxable income of SMEs will be cut from 17% to 16% next year. The tax rate applicable to the remaining taxable income and to 100% of the taxable income of large companies will come down from 21% to 20%.

The planned corporate income tax measures seek to attract even more foreign investment and increase the capitalisation of existing companies.

For further information please contact:

Eloísa Ribeiro Santos, Partner, RBMS – Member of ECOVIS International, Lisbon, Portugal
Email: eloisa.rsantos@rbms.pt

Bernardo Viana de Sá, Associate, RBMS – Member of ECOVIS International, Lisbon, Portugal
Email: bernardo.vsa@rbms.pt

Vaz de Almeida Advogados among the “Most Admired Law Firms in Brazil” for the 9th time

11.12.2024

Vaz de Almeida Advogados has been recognised for the 9th time as one of the “Most Admired Law Firms in Brazil by Major Companies”. This award is part of the “Análise Advocacia” 2025, which was presented on Thursday 28 November in São Paulo.

Influential Survey Among Business Leaders

The “Análise Advocacia” editorial project is an initiative of Análise Editorial and is widely regarded as the most comprehensive and important survey of the Brazilian legal market.

According to the publisher, only legal directors, CEOs and CFOs of Brazil’s 2,000 largest companies and financial institutions by revenue are invited to participate in the survey. Respondents are asked to spontaneously name the law firms they most admire, the practice areas in which those firms excel and their favourite lawyers – regardless of whether they are currently clients. The result is a unique panorama of the most admired firms and lawyers in the market and the areas of law in which they excel.

Team Success and Individual Recognition

With this latest recognition in the 2025 edition, Vaz de Almeida Advogados now has a total of nine nominations. The survey also highlights individual lawyers, and Vaz de Almeida is well represented in this regard. Amanda Pesciutti Duarte (corporate and business legal support) and Julhi Almiron Bonespírito (litigation and alternative dispute resolution) are among the “Most Admired Lawyers in Brazil”. Notably, this is the third time that Amanda has received this recognition.

International Expertise in the Automotive Sector

The 2025 edition of “Análise Advocacia – The Most Admired Law Firms and Lawyers in Brazil by Major Companies” also recognises Vaz de Almeida Advogados for its outstanding international expertise in the automotive and automotive parts sector. A significant proportion of the firm’s clients are Tier 2 companies headquartered in countries such as Germany, France, Italy, the United States and Canada.

Regional Excellence in São Paulo

Análise Editorial also ranked Vaz de Almeida among the “Most Admired Law Firms in the State of São Paulo”, distinguishing it as a “boutique firm” due to its technical excellence, highly personalised approach to clients and specialised practice areas.

For further information please contact:

Caio Vaz de Almeida, Managing Partner, Vaz de Almeida Advogados – Member of ECOVIS International, São Paulo, Brazil
Email: caio.vazdealmeida@vazdealmeida.com

Vietnam’s banking sector: Substantial innovations in Vietnam’s credit operations

10.12.2024

Vietnam’s banking sector is changing. The Vietnamese government has therefore passed a law for credit institutions. It aims to strengthen the regulatory framework for credit institutions and improve consumer protection. The law came into force on 1 July 2024. Ecovis consultants explain the background and details.

The banking sector and related activities in Vietnam have been experiencing robust and rapid growth. This presents both opportunities and risks for businesses, as well as for the overall stability of the financial system. Cyber threats and data breaches have become increasingly prevalent, posing significant challenges to the security and integrity of financial institutions. With the new law, the government wants to solve the problems and increase the resilience of the banking sector.

Notable changes under the law on credit institutions

• Enhanced transparency in corporate governance: Shareholders holding 1% or more of a credit institution’s shares are required to disclose their personal information, the number of shares held, and the proportion of shares held by related parties. Credit institutions must publicly disclose this information and submit reports to the State Bank of Vietnam. Additionally, the law sets limits on the ownership of a credit institution by a shareholder and their related parties.
• Data protection and privacy: The Law imposes stricter requirements on credit institutions regarding the collection, storage, and protection of customer data. Credit institutions are now obligated to provide accurate, complete, and timely information to customers. Moreover, the scope of protected customer information has been expanded to include all customer-related information, not just account-related information.
• Unbundling of credit and insurance products: Credit institutions are prohibited from tying the sale of insurance products to the provision of credit. This provision aims to prevent coercive selling practices and protect consumers from being pressurised into purchasing insurance products that they do not need or want.
• Credit ceiling reduction: The Law has introduced a gradual reduction in the credit ceiling for individuals. Specifically, the total outstanding loans to an individual will be capped at 10% of the credit institution’s equity by 2029, down from 14% currently. Similarly, the ceiling for loans to a related group of individuals will be lowered from 23% to 15%.
• Development of digital banking: The Law encourages the development of digital banking channels. This includes a wide range of digital banking activities such as digital account opening, remote loan processing, digital transaction history, and digital signature for credit contracts.

We support companies in complying with the new regulations and thus ensuring sustainable growth.

Vu Manh Quynh, Managing Partner, ECOVIS Vietnam Law, Ho Chi, Minh City, Vietnam

Advantages and challenges for customers

Advantages

• Enhanced customer protection: Customers will enjoy greater protection with stricter regulations governing data privacy, transaction security, and dispute resolution. A stable and secure financial system is crucial for individuals and businesses to conduct their economic activities with confidence.
• Wide range of products and services: Increased competition will drive banks to offer a wider variety of products and services, giving customers more choices.

Challenges

• More complex procedures: Customers may face more complex procedures to comply with new regulations, such as providing more detailed information about loan purposes and meeting stricter eligibility criteria.
• Potential instability of digital systems: As digital banking systems are still under development, customers may encounter technical difficulties, which could disrupt their banking activities.
• Enhancing human capital: In an ever-changing legal and business environment, enterprises must continually develop their workforce to ensure they are equipped to adapt and comply with new regulations.

For further information please contact:

Vu Manh Quynh, Managing Partner, ECOVIS Vietnam Law, Ho Chi Minh City, Vietnam
Email: quynh.vu@ecovislaw.vn

Nguyen Nhuan, Partner, ECOVIS Vietnam Law, Ho Chi Minh City, Vietnam
Email: nhuan.nguyen@ecovislaw.vn