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Businesses complain about new CIT payment regulation

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Under the new regulation, by the end of the third quarter, enterprises have to estimate the amounts of tax of the fourth quarter and pay the amounts.

Some of the Decree 126 provisions effective on December 5 related to the Law on Tax Administration, say that the total amount of corporate income tax (CIT) that enterprises temporarily pay in the first three quarters of the year must not be lower than 75 percent of the CIT amounts they have to pay for the whole year.

Businesses complain about new CIT payment regulation

This means that by the end of the third quarter, enterprises have to estimate the amounts of tax of the fourth quarter and pay the amounts instead of the end of the fourth quarter as previously applied.

Dang Ngoc Minh, deputy general of the General Department of Taxation (GDT), told the press on the sidelines of the dialogue between enterprises and customs and taxation agencies held some days ago, that the state budget has a shortage and the purpose of the budget collection is to get money to pay for state management operations, especially to allocate to provinces that cannot cover expenses.

In other words, the budget collection progress plays a very important role in the operations of many localities.

Asked if GDT has received complaints about the new regulation from enterprises, he said these are just a few enterprises and they don’t represent the whole business community.

The official stressed that the tax collection must be done in reference to the local budget management and the benefits of society.

This means that despite the complaints, GDT is still determined to collect tax as planned.

What will happen if enterprises are fined not because they did not pay tax, but just because they did not anticipate the sharp increase in the amount of tax they would have to pay in Q4?

In replay, GDT said it believes that this may happen but not regularly, because enterprises can foresee their business performance.

But enterprises disagreed with GDT about the uncommon number of cases that saw revenue soaring unexpectedly in Q4.

“GDT always sets estimates on state budget collections every year. Will it dare to affirm that it can collect 75 percent of the total budget collections of the whole year by the end of Q3?” a businessman said. “Will it be fined if it fails to do this?”

The businessman went on to explain that no business dares to set revenue targets quarterly, but they only dare set for the whole year.

“Everyone wants to fulfill yearly business plans, but unexpected things always occur. Businesses were preparing for the year-end sale season, when new Covid-19 infections were discovered in HCM City,” he said.

According to GDT, the Decree 126 will take place on December 5. This means that enterprises, seriously affected by Covid-19, will not be affected by the new regulation this year, because the deadline for temporary tax payment was the last day of October, or Q3.

“Who dares to say he will make profit this Tet sale season? With the regulation, it is still unclear which businesses will take a loss and which will make a profit, but all of them now have to make temporary tax payments,” he said.

When the Decree 20 dated in 2017 on the tax administration applied to enterprises with transactions with related parties facing businesses’ complaints, the Prime Minister has repeatedly requested to amend the decree. It took three years to do this.

The decree covers only 8,000 businesses, 83 percent of which are foreign invested enterprises and 17 percent Vietnamese enterprises.

Meanwhile, the number of businesses to be affected by Decree 126 is much higher and the businesses are from many different economic sectors which face difficulties.

The regulation will have a big impact on enterprises and lead to serious consequences, even if it is amended later.

The director of an enterprise warned that businesses that have been hit hard by Covid-19 will become even worse because of the new regulation on temporary tax payment.

“You don’t have money, but you still have to pay taxes in advance, based on the estimated profit you may make in the future. It is just like taxing dreams,” he commented.

Meanwhile, according to GDT, the Decree 126 will take place on December 5. This means that enterprises, seriously affected by Covid-19, will not be affected by the new regulation this year, because the deadline for temporary tax payment was the last day of October, or Q3.

So, enterprises will only have to make temporary tax payment in accordance with Decree 126 by the end of October 2021. 

Duy Anh

Source: https://vietnamnet.vn/en/feature/businesses-complain-about-new-cit-payment-regulation-694866.html

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Foxconn unit receives business license for $270 mln Vietnam plant

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Foxconn unit receives business license for $270 mln Vietnam plant

A motorcyclist rides past the logo of Foxconn, the trading name of Hon Hai Precision Industry, in Taipei, Taiwan March 30, 2018. Photo by Reuters/Tyrone Siu.


The FuKang Technology Company, a Foxconn unit, received a business license Monday to build a plant to produce laptops and tablets in northern Vietnam.

The plant will be located in the Quang Chau Industrial Park in the northern province of Bac Giang and will annually produce eight million units, the government said in a statement on its website.

The Taiwanese electronics contract manufacturer has so far invested $1.5 billion in Vietnam and created jobs for more than 35,000 workers and the company, formally known as the Hon Hai Precision Industry Co., plans to raise its investment by $700 million and recruit 10,000 more local workers this year, the government said.

Last week Foxconn was also looking into investing $1.3 billion in Thanh Hoa Province, 160 km south of Hanoi.

Last year, the company produced the first batch of display screens at its $26-million factory in the northern Quang Ninh Province.

Foxconn, a major assembler of Apple products, including the iPhone, and the world’s largest contract manufacturer, came to Vietnam in 2007, and has been operating mainly in the northern provinces of Bac Ninh, Bac Giang and Vinh Phuc, making computers and other electronic products and car parts.

It has said that Vietnam is its largest manufacturing hub in Southeast Asia.

Source: https://e.vnexpress.net/news/business/companies/foxconn-unit-receives-business-license-for-270-mln-vietnam-plant-4222816.html

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VN-Index inches down in week’s opening session

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VN-Index inches down in week’s opening session

An investor points at stock prices on a laptop at a brokerage in Ho Chi Minh City. Photo by VnExpress/Quynh Tran.


The VN-Index edged down 0.19 percent to 1,191.94 points after struggling to stay in the green throughout the trading day.

The Ho Chi Minh Stock Exchange (HoSE), on which the VN-Index is based, was predominantly green despite closing in the red, with 273 stocks gaining and 201 losing. Total trading volume fell slightly over the previous session to VND17.76 trillion ($767.14 million).

Blue chips were the main drag this session, with the VN30-Index for the stock market’s largest caps plunging 0.75 percent.

Private banks did not do well this session. EIB of Eximbank shed 2.5 percent, STB of Sacombank 2.4 percent, HDB of HDBank 2.3 percent, VPB of VPBank 2.1 percent, and TCB of Techcombank, 1.8 percent.

State-owned banks did slightly better. Among Vietnam’s three biggest lenders by assets, CTG of VietinBank dropped 2.3 percent and BID of BIDV went down 0.4 percent while VCB of Vietcombank edged up 0.1 percent. MBB of mid-sized Military Bank fell 2.1 percent.

All real estate stocks ended in the red. NVL of Novaland shed 1.1 percent, KDH of Khang Dien House, 1 percent, TCH of Hoang Huy Group, 0.9 percent and VHM of giant Vinhomes 0.5 percent.

Other major losing tickers this session included SSI of top brokerage SSI Securities Corporation, down 1.8 percent, GAS of energy giant PetroVietnam Gas and MWG of electronics retailer Mobile World, both down 1.1 percent, and VIC of private conglomerate Vingroup, 0.8 percent.

Topping gains for the sixth session was ROS of construction firm FLC Faros, up 6.9 percent, hitting its ceiling price again. Despite this, ROS closed at VND3,740, far below its VND12,600 IPO in 2016 and a high of VND178,000 in late 2017.

The ticker has been plummeting since early 2018 as a result of increasingly poor business performance, and is now the smallest capped ticker on the VN30.

It was followed by SBT of agricultural exporter TTC-Sugar, up 5 percent, POW of electricity generator PetroVietnam Power, 2.8 percent, MSN of food conglomerate Masan Group, 2.3 percent, and VRE of mall operator Vincom Retail, up 1.8 percent.

The HNX-Index for the Hanoi Stock Exchange, home to mid-and small-caps, surged 2.23 percent, while the UPCoM-Index for the Unlisted Companies Market slipped 0.11 percent.

Foreign investors were net sellers to the tune of around VND620 billion on all three bourses, with the net selling focused mostly on HPG of steelmaker Hoa Phat Group (up 0.2 percent), SSI of SSI Securities Corporation and VHM of Vinhomes.

Source: https://e.vnexpress.net/news/business/economy/vn-index-inches-down-in-week-s-opening-session-4221149.html

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Winners of HCMC Brand Award to be announced Thursday

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A poster of the HCMC Brand Awards, which will be held on January 21 – PHOTO: COURTESY OF ORGANIZER

HCMC – The HCMC Department of Industry and Trade and The Saigon Times Group will co-organize the HCMC Brand Award at the GEM Center in District 1 on Thursday, January 21, aimed at honoring enterprises in the city for their efforts in building their brands.

Since the launch of the HCMC Brand Award on December 1 last year, as many as 64 firms have registered to participate in the awards.

These applicants were required not to violate ownership rights nor show acts of trade fraud, while working on building their brands for at least two years.

The winners will be evaluated and selected by experts in brand building and customers based on the following criteria: efficiency in brand building, innovation, creativity, the quality and safety of products and corporate social responsibility.

Earlier at the launch ceremony, Bui Ta Hoang Vu, director of the HCMC Department of Industry and Trade, said the HCMC Brand Award would help raise the awareness of businesses operating in the city over the importance of building their brands and encourage them to accelerate innovation, creativity and sustainable development.

Besides, the awards are expected to help them reach out to the global market.

Source: https://english.thesaigontimes.vn/80240/winners-of-hcmc-brand-award-to-be-announced-thursday.html

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