What are the severance tax-liable objects in Vietnam?

What are the severance tax-liable objects in Vietnam?

According to Article 2 of the Law on severance tax 2009 (amended by Clause 1, Article 4 of the Law on Amendments to Various Tax Laws 2014), the severance tax-liable objects include:

- Metallic minerals.

- Non-metallic minerals.

- Crude oil.

- Natural gas, coal gas.

- Natural forest products, other than animals.

- Natural aquatic products, including marine animals and plants.

- Natural water, including surface water and underground water, except for natural water used for agriculture, forestry, aquaculture, and salt production..

-Natural swallow's nests.

- Other resources prescribed by the National Assembly Standing Committee.

Which entities are severance tax payers in Vietnam?

According to Article 3 of the Law on severance tax 2009 (amended by Clause 2, Article 67 of the 2022 Petroleum Law), the taxpayers are stipulated as follows:

- Payers of severance tax are resource-extracting organizations and individuals subject to severance taxation, except for exploitation of oil and gas fields, groups of oil fields and blocks according to the regulations of law on petroleum.

- In some cases, severance tax payers shall be defined as follows:

+ For a mining enterprise established on the basis of joint venture, the joint-venture enterprise shall pay severance tax:

+ For Vietnamese and foreign parties to a business cooperation contract to exploit natural resources, the parties' liability to pay severance tax must be specified in such contract:

+ In case an exploiter conducts small-scale exploitation of natural resources and sells them to a principal purchaser that has a written commitment or an approval to declare and pay severance tax on the exploiter's behalf, the principal purchaser shall pay severance tax.

Thus, entities required to pay severance tax include individuals and organizations exploiting the aforementioned resources.

What are the severance tax-liable objects in Vietnam? (Image from the Internet)

What is the frame severance tax tariff in Vietnam?

Under Article 7 of the Law on severance tax 2009, tax rates are stipulated as follows:

- The frame severance tax tariff is specified below:

-  Specific severance tax rates for crude oil. natural gas and coal gas shall be determined as partially progressive based on their daily exploited average output.

- Under Clauses 1 and 2 of  Article 7, Law on severance tax 2009, the National Assembly Standing Committee shall stipulate specific severance tax rates for each category of natural resource in each period on the following principles:

+ Ensuring conformity with the list of groups and categories of natural resource and within the severance tax rate bracket prescribed by the National Assembly:

+ Contributing to the state management of natural resources; protection, exploitation and rational, economical and effective use of natural resources:

+ Contributing to assuring state budget revenues and market stabilization.