VIETNAM Law and Practice Contributed by: Thang Nguyen, Minh Nguyen and Nguyet Le, ACSV Legal
Tax Holidays Tax holidays can consist of tax rate reductions of 10% and 17% for 15 years and ten years respectively, starting from the commencement of the operation. It can also consist of a 50% reduction for two to nine years; or consist of a tax exemption for two to four years, followed by a tax rate reduction. Other Incentives If they meet the relevant criteria, enterprises may qualify for participation in training or assistance programmes, and other programmes organ - ised by the competent authorities. Qualifying enterprises may also receive preferential loans, participation in technical support or investment enhancement programmes, information on the technology market and co-operation opportu - nities, exemption from import duty on goods imported, and exemption from and reduction of land rental fees and non-agricultural land-use tax. 5.4 Tax Consolidation There is currently no regime in place which allows for tax consolidation in Vietnam. 5.5 Thin Capitalisation Rules and Other Limitations Except for certain sectors such as securities companies, Vietnam does not currently have any thin capitalisation rules or similar limitations in place. However, the government of Vietnam is currently considering the implementation of a debt–equity ratio, which is under discussion and may be implemented in the near future. 5.6 Transfer Pricing Under Decree 132/2020/ND-CP (as amended by Decree 20/2025/ND-CP), companies with relat - ed-party transactions must submit relevant dec - laration forms with their CIT finalisation return
and prepare a transfer pricing dossier, includ - ing the Local File, Master File, and Country-by- Country Report (CbCR). Interest expense is capped at 30% of EBITDA to prevent excessive debt use for tax avoidance. On 3 January 2025, Vietnam joined the OECD’s Multilateral Competent Authority Agreement (MCAA) CbCR to facilitate global exchange of Under the current Law on Tax Administration of Vietnam (No 38/2019/QH14), tax authorities have been endowed with additional enforcement powers, which directly translates into more strin - gent and successful prosecution of tax evaders. Specifically, in cases where there is suspicion of tax evasion, tax authorities may exercise the following powers during tax inspection. • Collection of information related to tax eva - sion. • Impoundment of documents and exhibits related to tax evasion. • Inspection of premises for documents and exhibits related to tax evasion. 5.8 Tariffs Vietnam Tax Regime Overview and Tariff Structure Vietnam’s tariff regime reflects a balance between its commitment to international eco - nomic integration and the strategic need to pro - tect certain domestic industries. The country has established free trade relations with more than 60 countries through the signing of 17 Free Trade Agreements (FTAs), including modern agreements such as the Comprehensive and Progressive Agreement for Trans-Pacific Part - nership (CPTPP) and the EU–Vietnam Free Trade Agreement (EVFTA). These agreements have led transfer pricing information. 5.7 Anti-Evasion Rules
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