Tax Policy

VAT deduction

On 4 October 2023, the Government issued Resolution No. 164/NQ-CP with the following remarkable content: The Ministry of Finance has proposed to the National Assembly continue to apply 2% VAT reduction in the first half of year 2024. The national Assembly Standing Committee will consider and decide to apply it in case the economic and business situation remain weak and report to the Prime Minister before 7 October 2023.


30% reduction of land rent payable in 2023

On 3 October 2023, the Prime Minister issued Decision No. 25/2023/QD-TTg with some notable points below:

 – 30% reduction of land rent in 2023 will be applied for organizations, enterprises, households and individuals that are directly leasing land from the State under decisions or contracts or certificates of land use rights and rights to ownership of houses and other property on land issued by competent regulatory authorities via the method of land lease with annual rental payment (hereinafter referred to as “land lessees”).

–  The reduction is not applied to outstanding land rental payments incurred before 2023 and the late payment interest thereon, if any.

– In case a land lessee is being given a reduction in land rents and/or a deduction of compensation and ground clearance, the 30% reduction shall apply to the land rents payable (if any) after reduction or/and deduction (except for land rents that have been reduced according to Decision No. 01/2023/QD-TTg dated 31 January 2023 of the Prime Minister).

This Decision comes into force from 20 November 2023.


Tax imposition on income from loans with interest rates lower than usual interest rates of the same term and scale loans in the market

On 25 August 2023, the General Department of Taxation issued Official Letter No. 3782/TCT-CS on tax policy as follows:

An enterprise, that is not operating under the Law on Credit Institutions, has irregular lending activities to other organizations (including its branches that pay separate corporate income tax) without interest or at a lower interest rate than the usual interest rate for the same term and scale on the market will be imposed tax liability according to the regulations of tax administration law.



Recruitment of foreign workers

On 18 September 2023, the Government issued Decree No. 70/2023/ND-CP amending the Government’s Decree No. 152/2020/ND-CP dated 30 December 2020 on foreign workers working in Vietnam and recruitment and management of Vietnamese workers working for foreign employers in Vietnam. Accordingly, Article 4 of Decree No. 152/2020/ND-CP is amended as follows:

–  At least 15 days before the date on which foreign workers are expected to be employed, the employer (except contractor) shall determine the demand for foreign workers for every job position for which Vietnamese workers are underqualified and send an explanation report to the Ministry of Labor, War Invalids and Social Affairs or the Department of Labor, War Invalids and Social Affairs of province where the foreign workers are expected to work, using Form No. 01/PLI Appendix I hereto appended.

–  From 1 January 2024, the announcement of recruitment of Vietnamese workers to positions expected to recruit foreign workers shall be made on the website of the Ministry of Labor, War Invalids and Social Affairs (Employment Department) or the website of the Employment Service Center, which is established by the President of the People’s Committee of province or centrally affiliated city (hereinafter referred to as province), within at least 15 days from the expected date of sending an explanation report to the Ministry of Labor, War Invalids and Social Affairs or the Department of Labor, War Invalids and Social Affairs where the foreign worker is expected to work. The recruitment announcement shall contain job position/job title, job description, quantity of workers, required qualifications and experience, salaries, working time and location. After an unsuccessful attempt to recruit Vietnamese workers for positions that are expected to be filled by foreign workers, the employer is responsible for determining the demand for employing foreign workers in accordance with point a, clause 1 of this Article.

This Decree comes into force from 18 September 2023.