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On June 8, 2024, Vietnamese Government officially issued Resolution No. 83/NQ-CP on the National Assembly's Resolution project on value added tax (VAT) reduction as proposed by the Ministry of Finance in Report No. 127/TTr-BTC If we continue to implement the VAT reduction policy in the last 6 months of the year, the expected budget in 2024 will decrease by VND 47,488 billion; however, this policy will have a positive effect by stimulating production and promoting business activities, thereby generating revenue for the state budget..   The 2% VAT reduction policy is applied to goods and services currently subject to 10% VAT ( 10...

Vietnam’s foreign contractor tax (FCT) is a tax that is applied to transactions conducted in Vietnam between a foreign company or sub-contractor and a Vietnamese company. It is made up of two kinds of taxes. Accordingly, the foreign contractor will be subject to FCT including: (1) value-added tax (VAT) and (2) corporate income tax (CIT) if it is an enterprise / or personal income tax (PIT) if it is an individual in accordance with the provisions of the foreign contractor tax law.   Vietnam’s foreign contractor tax is applicable when carrying out business in Vietnam under a contract signed with a Vietnamese party...

On February 29, 2024, the Ministry of Finance coordinated with the Embassy of the Republic of Korea in Vietnam to organize a dialogue conference between the Ministry of Finance and Korean businesses on tax and customs policies and administrative procedures. The Ministry of Finance has issued an official dispatch responding to businesses' problems. For some On-spot import and export issues, the Ministry of Finance has responded as follows. 1. Opinion: In case a Vietnamese enterprise, after signing a sales contract with a foreign trader, provides goods to an export processing enterprise (EPE) as designated by the foreign trader, will it carry...

The bidding package on the construction, supply and installation of equipment for the expansion of the T2 terminal of the Hanoi-based Noi Bai International Airport kicked off on May 19, with Prime Minister Pham Minh Chinh attending. The expanded terminal is expected to come into operation by December 2025.   The project aims to raise the terminal's annual passenger capacity from 10 million to 15 million, with a total investment capital of VND4.99 trillion (US$196.07 million). The terminal was put into operation since 2015 with an annual capacity of 10 million passengers but it has experienced overload since 2018. The terminal will...

The shipping group Maersk said on May 6 that disruptions in container shipping activities on the Red Sea are increasing and predicted to reduce shipping capacity between the ASIA and EUROPE by up to 20% in the second quarter of 2024. Since December 2023, Maersk and other shipping lines have had to redirect ships around South Africa's Cape of Good Hope to avoid attacks by Houthi forces in the Red Sea. This makes shipping time longer and increase freight rates.   In a notice sent to customers on May 6, Maersk said the risk area has expanded, forcing ships to take longer journeys,...

Previously, the National Assembly passed Resolution No. 110/2023/QH15, temporarily reducing value added tax (VAT) by 2% for some groups of goods currently subject to a tax rate of 10% (excluding some products and services) for an additional 6 months (from January 1, 2024 to June 30, 2024).   Based on the assessment of the outcome achieved by the 2% VAT reduction solution in Resolution No. 110/2023/QH15, the Government submits to the National Assembly for consideration and permission to continue implementing the 2% VAT reduction policy in the last 6 months of 2024 (from July 1, 2024 to December 31, 2024) Regarding the implementation,...