Vietnam to Slash Corporate Income Tax Rate

Vietnam's legislature has approved cuts in the country's corporate tax rates from Jan. 1, 2014.

 

The tax rate will be cut to 22 percent from 25 percent starting Jan. 1, 2014, and to 20 percent from Jan. 1, 2016

 

The cuts will “ensure the competitiveness of Vietnam’s businesses and attract foreign investment,” said National Assembly Vice Chairwoman Nguyen Thi Kim Ngan.SMEs with earnings of less than VND20bn (USD950,000) and fewer than 200 employees, which represent the vast majority of all businesses within Vietnam, will already enjoy the 20 percent rate from July 1 this year, and their preferential rate will reduce to 17 percent in 2016.

 

The Ministry of Finance estimates that the tax reductions will lead to lower tax revenue amounting to around VND22.2 trillion in 2014.

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