Vietnam Tax Exemptions: COVID-19 Support For Business and Individuals

On 19^th October 2021 the National Assembly Standing Committee issued a resolution (Resolution No. 406/NQ-UBTVQH15) introducing tax exemptions and reductions to support enterprises and individuals affected by the COVID-19 pandemic. These exemptions and reductions are listed below:

30% Reduction of Payable Vietnam Income Tax in 2021 (Corporate)

This reduction only applies to taxpayers who have:

1. revenue in 2021 not exceeding VND 200 billion; and
2. a decrease in revenue in 2021 compared to revenue in 2019.

Please note that criteria [2] doesn’t apply for taxpayers whowere newly established, consolidated, merged, divided or separated in the 2020 or 2021 tax period.

Exempt from Vietnam Income Tax (Personal), VAT and Other Payable Tax

This exemption applies to households and individuals involved in production and business activities in district-level areas affected by the COVID-19 pandemic in 2021 for the months in the third and fourth quarter of 2021 only. Please note that the district-level areas affected by the COVID-19 pandemic in 2021 are decided by the Chairman of the province-level People’s Committee.

This exemption does not apply to income and revenue from software products and services, including digital information content products and entertainment services, video games, digital movies, digital photos, digital music and digital advertising.

30% Reductionof Value-Added Tax (VAT) Until the End of 2021

From 1 November to 31 December the following goods and services will enjoy a 30% reduction in VAT rate or 30% of the taxable percentage, depending on the tax calculation method. The goods and services this applies to are:

1. Transportation services; Lodging; Food Service; various tourism services.
2. Publishing products and services; cinematographic services, television program production, sound recording and music publishing; works of art and services for composing, art, and entertainment.

No Interest on Late Payments Incurred in 2020 and 2021

Interest will be waived on late payments made during 2020 and 2021 for tax debts, land use fees and land rental fees for enterprises and organizations which incurred losses in 2020.

For further information please contact:

Vu Manh Quynh , Managing Partner
Email: quynh.vu@ecovislaw.vn