LEGAL UPDATE: Did you know that the Government has issued the resolution to reduce CIT by 30% for companies in 2020?
On 19 June 2020, the National Assembly passed Resolution No. 116/2020/QH14 on reducing corporate income tax (“CIT”) in 2020 (“Resolution 116”).
Qualified entities will receive a 30% reduction in CIT.
We wrote about this previously and promised that we would update you once we receive actual legislation.
1. Applicable entities
Resolution 116 applies to the following entities:
• An enterprise established under the law of Vietnam;
• An organization established under the Law on Cooperatives;
• A professional entity established under the law of Vietnam;
and
• Any other organization established under the law of Vietnam and conducting activities of production and/or trade in goods and services which earns income.
2. Condition to qualify for CIT reduction
There is only one condition to qualify for CIT reduction: total revenue in 2020 does not exceed VND 200 billion.
In addition, each qualified taxpayer may self-assess the amount of the reduction when paying provisional CIT on a quarterly basis and at the end when CIT is finalized for 2020.
Resolution 116 took effect on 3 July 2020 and applies to the tax periods in 2020.
The translation in English is in the link below:
DN Legal, 17 July 2020
