Corporate income tax base to be broadened when implementing tax policy reform in Vietnam?

Corporate income tax base to be broadened when implementing tax policy reform in Vietnam?

According to Point d, Clause 1, Section 3, Article 1 Decision 508/QD-TTg in 2022, it is stipulated:

III. SOLUTIONS FOR IMPLEMENTING THE STRATEGY

1. Concerning tax policy reform

...

d) For corporate income tax: review to amend or abolish tax exemption and reduction incentives that are no longer consistent with development requirements and international integration demands; minimize the mixing of social policies with tax exemption and reduction policies, ensuring the neutrality of tax to apply stably in the medium and long term ; implement corporate income tax incentives for small and micro enterprises, while shifting the main policy focus of attracting foreign investment from quantity to quality, encouraging the participation of all economic sectors in investment in key industries, sectors, and areas that need investment encouragement. Broaden the tax base in line with the socio-economic context of the country and international practices; implement standards for combating transfer pricing and revenue erosion according to international practices;

...

Accordingly, the solution to implement the corporate income tax policy reform strategy according to the tax system reform strategy until 2030 is as follows:

- Review to amend or abolish tax exemption and reduction incentives that are no longer consistent with development requirements and international integration demands;

- Minimize the mixing of social policies with tax exemption and reduction policies, ensuring the neutrality of tax to apply stably in the medium and long term;

- Implement corporate income tax incentives for small and micro enterprises, while shifting the main policy focus of attracting foreign investment from quantity to quality, encouraging the participation of all economic sectors in investment in key industries, sectors, and areas that need investment encouragement;

- Broaden the tax base in line with the socio-economic context of the country and international practices;

- Implement standards for combating transfer pricing and revenue erosion according to international practices.

Thus, the implementation of the corporate income tax policy reform strategy according to the tax system reform strategy until 2030 will broaden the tax base in line with the socio-economic context of the country and international practices.

Corporate income tax base to be broadened when implementing tax policy reform in Vietnam (Image from the Internet)

What are the viewpoints on implementing tax policy reform in Vietnam?

According to Clause 1, Section 1 Decision 508/QD-TTg in 2022, the viewpoint on implementing tax policy reform is as follows:

- Taxes, fees, and charges are state tools to contribute to the management, regulation, and stabilization of the macroeconomy, restructuring the economy, mobilizing resources to ensure the economy's quality growth, efficiency, rapid and sustainable development; harmoniously resolving economic development and environmental issues associated with the goals and tasks of the 10-year socio-economic development strategy 2021-2030;

- The tax policy system is perfected, synchronized, and restructures the state budget revenue to ensure sustainability, contributing to improving the investment and business environment in the direction of broadening the tax base; reasonably mobilizing resources for the state budget, ensuring the synchronization, fairness, and neutrality of tax policies; simple, transparent, clear, understandable, and easy to implement. Tax policies are only stipulated in legal documents related to taxes and are perfected, amended, and supplemented to ensure consistency in legal effect among tax laws and other related legal documents;

- The tax management institution continues to be perfected to simplify administrative procedures, promote the application of information technology to reduce the compliance costs of tax laws for citizens and businesses; at the same time, create a legal basis to build a modern, professional, efficient, effective, and integrity tax agency in Vietnam, capable of implementing and managing the stated tax system reform goals and contents.

What are responsibilities of the ministries and agencies in implementing the tax policy reform strategy in Vietnam?

According to Clause 1, Section 5 Decision 508/QD-TTg in 2022, the ministries and agencies have responsibilities in implementing the tax policy reform strategy as follows:

- The Ministry of Finance is responsible for:

+ Leading and organizing the implementation of the tax system reform strategy until 2030;

+ Guiding and urging other ministries, agencies, and localities according to their functions and assigned tasks to build and organize the implementation of programs and contents related to the strategy;

+ Leading, cooperating with related ministries and localities to check the implementation of the strategy; annually and every 5 years, organizing preliminary reviews, evaluations, and drawing experiences from implementing the strategy;

+ Leading, cooperating with related agencies to propose and submit to the Prime Minister of the Government of Vietnam decisions on adjusting goals and contents of the strategy in necessary cases.

- The Ministry of Planning and Investment leads and cooperates with the Ministry of Finance in balancing and allocating annual public investment capital in accordance with the Law on State Budget and the Law on Public Investment to implement the strategy.

- The People's Committees of provinces and centrally-run cities cooperate with the Ministry of Finance and related agencies based on state management functions and tasks within their localities according to the law's provisions, directing and participating in implementing related contents of this strategy.