Policies on taxes, fees and charges for cooperatives in Vietnam as of July 1, 2024

What are the policies on taxes, fees and charges and policies on access to funding and insurance for cooperatives in Vietnam as of July 1, 2024?

What is cooperative?

Pursuant to the Law on Cooperative 2023 (taking effect on July 1, 2024), cooperative means an organization that has the status of a juridical person, is voluntarily established by at least 05 official members who cooperate with and assist each other in production, business and job creation with the aim of meeting general economic, cultural and social demands of its members and making contribution to sustainable community and social development, and adheres to the principles of autonomy, equality and democracy.

Policies on taxes, fees and charges for cooperatives in Vietnam as of July 1, 2024

Policies on taxes, fees and charges for cooperatives in Vietnam as of July 1, 2024 (Internet image) 

Policies on taxes, fees and charges for cooperatives in Vietnam as of July 1, 2024

Pursuant to Article 22 of the Law on Cooperative 2023, the policies on taxes, fees and charges for cooperatives in Vietnam are as follows:

- Artels, cooperatives and cooperative unions shall be entitled to the most favorable tax, fee and charge incentives for the same business line and in the same area in accordance with regulations of law on taxes, fees and charges.

- Artel registration charges and fees for disclosing registration information on electronic information systems of business registration authorities shall not be collected.

- Corporate income tax (CIT) shall be exempted and reduced in accordance with regulations of the CIT Law in the following cases:

+ Incomes earned from internal transactions of a cooperative or cooperative union;

+ Incomes earned by an artel, cooperative or cooperative union when cooperating with other organizations and individuals in establishing value chains/sectoral business clusters associated with green economy, circular economy and knowledge economy for sustainable development;

+ Other cases as prescribed in the CIT Law.

- CIT on incomes forming undistributed funds and assets of cooperatives and cooperative unions shall be exempted in accordance with regulations of the CIT Law.

- Artels, cooperatives and cooperative unions shall be entitled to exemption and reduction of license fees as prescribed by the law on fees and charges.

- Organizations and individuals shall be exempted from payment of registration fees when following procedures for transfer of land use rights or ownership of assets which they contribute to cooperatives and cooperative unions in accordance with regulations of law on fees and charges.

Policies on access to funding and insurance for cooperatives in Vietnam as of July 1, 2024

Pursuant to Article 23 of the Law on Cooperative 2023, policies on access to funding and insurance for the cooperative in Vietnam as follows:

- Artels, cooperatives and cooperative unions shall be entitled to:

+ Apply for concessional loans from credit institutions as prescribed by laws;

+ Apply for concessional loans, post-investment interest rate incentives and investment credit guarantee of cooperative development assistance funds in accordance with the Government's regulations;

+ Be given priority to access funding of science and technology development fund, environmental protection fund, climate change adaptation fund and other financial institutions for the purpose of sustainable development as prescribed by laws;

+ Cooperatives and cooperative unions operating in financial and banking sector shall receive assistance in increasing their financial capability;

+ Be given priority and assistance to participate in investment promotion activities of ministries, regulatory authorities and local governments.

- When purchasing insurance for their undistributed assets, artels, cooperatives and cooperative unions shall be entitled to insurance premium subsidies as prescribed by the Law on insurance business.

- When purchasing voluntary social insurance, members of artels, cooperatives and cooperative unions shall be entitled to insurance contribution subsidies granted by the State in accordance with regulations of the law on social insurance.

Mai Thanh Loi

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