Jan. 29 – The Vietnamese Ministry of Finance finished drafting its Corporate Income Tax Law last week in a plan to cut current rates from 25 percent down to 23 percent.
Corporate income tax (CIT) rates have been adjusted several times over the past nine years: the 2003 CIT law of 2004 decreased rates from 32 percent to 28 percent, and the 2008 law further decreased them from 28 percent to 25 percent. The Ministry of Finance plans to lower the rate even further to 20 percent by 2020.
The Vietnam Tax Consultancy Association (VTCA), however, alleges that it would be more reasonable for the CIT rate to be reduced to 22 percent. The VTCA, despite agreeing with the planned 20 percent tax rate by 2020, believes that corporate income taxes should be lowered immediately so as to encourage businesses to expand their investments and to scale up production.
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