The VAT imposition on interest income generated by non-credit institutions is further confirmed by the Government in Letter 608/VPCP-KTTH dated 4 February 2012, in reply to the request of the Ministry of Finance (“MoF”) and the State Bank of Vietnam (“SBV”). The Letter outlines that interest income generated by non-credit institutions is subject to VAT as the Government does not encourage non-credit institutions to engage in and generate income from credit activities.

Tags: Tax Pointer, October 2012, Vietnam Read More

The Vietnam-Singapore DTT has generally been considered to provide advantageous benefits compared with other treaties. This favorable treatment has made Singapore a preferred location for investment vehicles for investment into Vietnam.

The changes under the second Protocol reduce the existing advantages available under the Vietnam-Singapore DTT. These changes include the restriction on the availability of the capital gains tax exemption, the criteria for the length of period for the determination of a permanent establishment for the provision of services, and certain other confirmations and clarifications.

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All property owners must file a tax return and pay the Property Tax before 30 September 2012. Failure to register property and pay the property tax may trigger the penalties according to the tax laws. Whilst there is no indication as to how a company will be penalized if it fails to pay property tax or is late in making this payment we can expect penalties in the range of 10 to 40% of the under-declared amount.

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Tax authorities worldwide and in Cambodia are under ever increasing pressure to collect revenue, causing an increase in tax audit activity across all jurisdictions and all types of tax. Uncertainty can arise as global businesses seek to access emerging and developing markets where the local tax environment may be unfamiliar, subject to different interpretations and extremely unpredictable.

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On 1 October 2012, the Amended Tax Law (№ 05/NA, 20 December 2011) is expected to come into force in the Lao PDR. The Amended Tax Law represents the first legislative amendment to the Tax Law (№ 04/NA, 19 May 2005) and will introduce significant changes for taxpayers in the Lao PDR.  The implementation of the Amended Tax Law will be further subject to details to be provided in an implementing decree.

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The Cambodian government has recently issued a new sub-decree No.88 dated 11 June 2012 that provides for an increase in the specific tax and export duty rates of certain motorcycles and seafood as follows:

Tags: Tax Pointer, June 2012 Read More

The General Department of Taxation (“GDT”) has recently issued a notification № 437 dated 19 April 2012, to provide clarification to Directors and/or Managers of enterprises operating in Cambodia who are subject to the real regime of tax.  The notification sets out the responsibilities with respect to the payment of tax liabilities in cases of a sale or transfer of a business in Cambodia, including by way of a sale of shares.

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On 28 February 2011, the Ministry of Finance issued Circular 28/2011/TT-BTC (“Circular 28”) to provide guidance on the Law on Tax Management, and superseded Circular 60/2007/TT-BTC (“Circular 60”). Circular 28 details various changes on tax administration, e.g. tax declaration procedures, deadlines, form, supporting documents, etc.

In this Tax Pointer, we discuss procedures and dossiers under Circular 28 to apply for a tax exemption/reduction under a double taxation agreement (“DTA”) to which Vietnam is a signatory.

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