Vietnam Regulatory Brief: Trade with Brunei, Tax Incentives, and a Looming Pokemon Go Ban
Vietnam and Brunei to Boost Trade, Investment
Vietnam and Brunei are expected to improve trade and invest in several sectors in an effort to strengthen economic ties. During talks held in Brunei on August 26-28, Vietnam’s President, Tran Dai Quang, spoke of several ways in which both countries can cooperate. Dignitaries of both countries have vowed to increase trade to over US $500 million by 2025. In addition, business leaders of both countries signed various documents and have promised to expedite other agreements.
Among the documents signed were MoUs on Cultural Co-operation and Economic and Trade Co-operation, while the leaders applauded the progress on the defense MoU between the Royal Brunei Navy and Vietnam People’s Navy on Bilateral Co-operation which was signed in December 2013. Both governments have also agreed to have the Joint Commission Meeting (JCM) at an earliest date to expand cooperation between the countries. The governments of both countries now want to finalize the agreement on maritime transport. The developments bode well for Vietnam and Brunei as they seek to strengthen ties and plan for greater investment and cooperation.
Authorities Propose Tax Break for Real Estate Developers
Vietnamese authorities have proposed to halve income tax for real estate builders that renovate deteriorating apartments. As per the proposal, such builders will get a 10 percent preferential tax rate during the 2017-2020 period. Such firms will be required to declare the income of each project separately to get the rate. The aim is to attract developers so that they can restore unsafe buildings, which has become a problem in Hanoi and Ho Chi Minh City. The Finance Ministry has stated that more than 200 buildings need to be rebuilt. The proposed regulation will be submitted to the National Assembly in October. If passed, the development will be a boost to property developers looking to invest in the sector.
Tax Exemption for Environmentally Friendly Products
The authorities issued Circular 128/2016/TT-TBC, which will exempt environmentally friendly products from export tariff, while on other products it will be reduced by half. The decree was issued by the Finance Ministry on August 9. Products that are on the export tables which were issued on a previous decree and also have the country’s green label certificate will be part of the export tax exemption. Products from recycling and waste treatment activities will have their tax rate cut by half.
The new tax rate will apply to organizations and individuals that are producing, trading, and exporting environmentally friendly products as well as products from recycling and waste treatment activities. The new regulation will come into effect on September 23. Foreign companies currently operating in Vietnam should take advantage of the new regulation to reduce their tax burden for exporting such products.
Authorities Consider Banning Pokemon Go
Vietnam’s Ministry of Information and Communications (MIC) is considering banning the popular smartphone game Pokemon Go. Authorities have already banned the game from governmental offices as well as military locations and other restricted sites. The game, which was launched on August 9, has become immensely popular in the country. For the moment the MIC has issued guidelines on how players can be safe while playing the game. Analysts have stated that the MIC will monitor the effects of the game before a complete ban is issued. The MIC has further stated that local and foreign game distributors must obey the law. Several countries including Thailand, Cambodia, and the Philippines have banned Pokemon Go from government and restricted sites.
Asia Briefing Ltd. is a subsidiary of Dezan Shira & Associates. Dezan Shira is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in China, Hong Kong, India, Vietnam, Singapore and the rest of ASEAN. For further information, please email firstname.lastname@example.org or visit www.dezshira.com.
Stay up to date with the latest business and investment trends in Asia by subscribing to our complimentary update service featuring news, commentary and regulatory insight.
Annual Audit and Compliance in Vietnam 2016
In this issue of Vietnam Briefing, we address pressing changes to audit procedures in 2016, and provide guidance on how to ensure that compliance tasks are completed in an efficient and effective manner. We highlight the continued convergence of VAS with IFRS, discuss the emergence of e-filing, and provide step-by-step instructions on audit and compliance procedures for Foreign Owned Enterprises (FOEs) as well as Representative Offices (ROs).
Navigating the Vietnam Supply Chain
In this edition of Vietnam Briefing, we discuss the advantages of the Vietnamese market over its regional competition and highlight where and how to implement successful investment projects. We examine tariff reduction schedules within the ACFTA and TPP, highlight considerations with regard to rules of origin, and outline the benefits of investing in Vietnam’s growing economic zones. Finally, we provide expert insight into the issues surrounding the creation of 100 percent Foreign Owned Enterprise in Vietnam.
Tax, Accounting and Audit in Vietnam 2016 (2nd Edition)
This edition of Tax, Accounting, and Audit in Vietnam, updated for 2016, offers a comprehensive overview of the major taxes foreign investors are likely to encounter when establishing or operating a business in Vietnam, as well as other tax-relevant obligations. This concise, detailed, yet pragmatic guide is ideal for CFOs, compliance officers and heads of accounting who must navigate Vietnam’s complex tax and accounting landscape in order to effectively manage and strategically plan their Vietnam operations.
- Previous Article Vietnam Market Watch: 7-Eleven’s Expansion, EU Investor Confidence, and Da Nang’s Struggles to Attract Investment
- Next Article Vietnam Proposes Removal of Healthcare Investment Restrictions