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VN ministry studies tax, fee reduction, exemption package

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Production at Fuhong Precision Component in Dinh Tram Industrial Zone, Bac Giang province, Vietnam. A 30 per cent reduction in corporate income tax is being considered to support Covid-hit enterprises. VIETNAM NEWS AGENCY

VN ministry studies tax, fee reduction, exemption package

The Vietnamese Ministry of Finance is studying a tax and fee reduction and exemption package estimated to be worth around 20 trillion dong ($870 million) to support citizens and enterprises affected by the Covid-19 pandemic.

Nguyen Quoc Hung, director of the ministry’s Tax Policy Division, said the proposals about tax and fee reductions and exemptions would be raised in a draft about budget collection solutions.

The procedure for the draft compilation would be shortened and proposed to the National Assembly’s Standing Committee soon to provide timely support to virus-hit citizens and businesses in the Southeast Asian country.

The pandemic had badly affected lives of citizens and production and business of enterprises, especially those of small and medium sizes and household businesses, as well as a number of sectors, including tourism, transportation, accommodation and catering services, Hung said.

“It is necessary to raise timely support for citizens and enterprises to help them overcome the impact of the Covid-19 pandemic,” he stressed.

Under the draft, four proposals about tax and fee reduction and exemption were raised.

Notably, the ministry proposed a 30 per cent reduction in the corporate income tax which enterprises must pay in 2021.

A 50 per cent reduction in tax which household businesses and individuals operating in all sectors must pay in the third and the fourth quarter of 2021 was proposed, together with a 30 per cent reduction in the value added tax for several sector.

The ministry also proposed exemption of the fee for late payments arising in 2020 and 2021 for enterprises and organisations which incurred losses for the three consecutive years of 2018, 2019 and 2020.

The government asked the ministry to complete the draft and propose it to the Prime Minister before August 10.

Hung said the reductions and exemptions were estimated to cause a drop of about 20 trillion dong in budget revenue.

The ministry was also studying proposals to reduce land use fees in 2021, he said.

It has been estimated that the government support in tax and fee reductions and exemptions will total 138 trillion dong this year, of which support worth 118 trillion has already been issued.

The tax and fee reductions and exemptions totalled 129 trillion dong last year.

VIET NAM NEWS/ASIA NEWS NETWORK

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