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Suddenly announced!Vietnam will "increase taxes" to multinational enterprises

  • Release Date:2023-12-05
The Vietnamese Parliament recently decided that as part of the global tax reform, Vietnam will increase the actual effective tax rate of multinational companies to 15%from January next year, and at the same time postponed the incentive measures that were previously prepared to offset some higher tax rates.

This latest tax rate will be consistent with the global agreement that combats the tax avoidance of multinational enterprises, but it may crack down on direct investment in Vietnam.

Vietnam's official corporate income tax rate was 20%before, but for many years, the country has provided tax reduction and exemption to large foreign investors, thereby promoting the actual tax rate paid by Samsung and other large multinational enterprises as low as less than 5%.

According to the estimation of the Ministry of Finance of Vietnam, as the Vietnamese Parliament voted to increase the lowest corporate income tax of the multinational company to 15%, this will affect 122 multinational companies and will bring Vietnam a 14.6 trillion Vietnamese Shield (about about it.Income of $ 603 million).

China is one of Vietnam's largest foreign direct investment sources. Many textile and clothing listed companies such as Shenzhou International have factories.

Regarding the Tax Reform of Vietnam, Zheshang Securities analysts Ma Li and Zhan Luyu pointed out that from the feedback from some spinning clothes in the Vietnamese company, the incident had some expectations in the early stage, but the specific rules, whether the preferential subjects had previously enjoyed the preferential subject, whetherThere are other forms of subsidies and so on.

Vietnam's latest tax rate changes will be consistent with the world's lowest tax rate initiative, which is supported by US Finance Minister Yellen.According to the initiative, since 2024, the global annual turnover of more than 750 million euros ($ 825 million), no matter where they are, need to pay a minimum tax rate of 15%.

Other Southeast Asian countries that have benefited from the trend of supply chain in recent years, such as Thailand, are expected to follow suit.