Legal Document Updates in English (10/2015)

FROM JULY, 2015, ENTERPRISES MAY DECIDE ON THE APPEARANCE, QUANTITY
OF SEAL
 

From July 01, 2015, enterprises may decide on the appearance, quantity and content of seal and before using a seal, an enterprise shall notify the seal specimen to the business registration agency for publicly posting on the national enterprise registration portal. These are significant contents as prescribed under the Law No. 68/2014/QH13 on Enterprises approved by the National Assembly on November 16, 2014.

Under this law, limited liability companies and joint stock companies may have one or more than one at-law representative, of which at  least  one  at-law  representative resides in Vietnam. An enterprise shall ensure that at least one at-law representative resides in Vietnam. In case an enterprise has only one at-law representative, such  person  must  reside  in  Vietnam  and  shall,  upon  leaving  Vietnam, authorize in writing another person to exercise the rights and perform the obligations of the at-law representative.

Another significant point is regulation on omission of business sectors in enterprise registration certificate. From

PROCEDURES OF DECLARING VALUE ADDED TAX FOR FOREIGN CONTRACTORS
 

On February 11, 2015, the Ministry of Finance signed the Decision No. 274/QD-BTC on publishing amendments and supplements of administrative procedures in the tax management under the Ministry of Finance’s authority.

Under this Decision, procedures of declaring tax for foreign contractors, foreign sub-contractors paying value added tax according to the direct method on value added tax, paying enterprise tax based on percentage of revenue for business operations and other incomes shall be amended and replaced.

Specifically, foreign contractor, foreign sub-contractor shall prepare one dossier including tax declaration (according to the Form), copies of the Contract for Contractor/Sub-Contractor certified by the tax payer (for the first tax

declaration of Contract for Contractor); Copy of Business License or Profession license certified by the tax payer and send to the Department of Taxation. Of which, tax declaration shall be made in each arising tax duty. Deadline for submitting the tax declaration document is no later than the tenth day since the day of arising tax duty.

In the event that Vietnamese party pays for foreign contract many times in the month, it can be declared by month instead of making declarations for each time. Deadline for submitting the tax declaration document is no later than the twentieth day of the next month since the month of arising tax duty.

FROM 2015, INCOMES FROM CASINOS SHALL NOT BE TAXABLE
 

According to the Law No. 71/2014/QH13 dated November 26, 2014 amending and supplementing a Number of Articles of the Laws on Taxes approved by the National Assembly, incomes  from  independent  professional  activities  of  individuals possessing practice licenses or certificates in accordance with law and having  an  annual  turnover  of  100  million  VND or less shall not have to pay personal income tax from January 01, 2015. Similarly, incomes from casinos are also omitted from taxable incomes from January 01, 2015.

Besides, the Law also amended the tax rate for businesspeople. Accordingly, personal income tax for businesspeople shall pay personal income tax calculated as a certain percentage of turn-over in each field, industry or business line. Of which, tax rates for goods distribution and supply: 0.5%; Services and construction activities without supply of raw materials and materials: 2%. Particularly for asset lease, insurance agency, lottery agency and multi-

level marketing agency: 5%; Production, transportation and services associated with goods, construction activities involving supply of raw materials and materials: 1.5%;

Incomes from capital investment; Incomes from copyright, commercial franchising; Incomes from prizes; Incomes from inheritances, gifts; Incomes from capital transfer shall pay at the tax rates of 5%; 10%; 2% and 0.1% respectively.

Another significant content is regulation on cancellation of penalty of 0.07%/day for late payment if paying tax after 90 days. From January 01, 2015, taxpayers that pay tax after the prescribed time limit or extended time limit for tax payment or the time limit stated in the notice or handling decision of a tax administration agency shall fully pay tax amounts and late payment interest at the rate of 0.05% of the late paid tax amount per each day of late payment.

NOT CARRY OUT PROCEDURES FOR INVESTMENT REGISTRATION
FOR DOMESTIC INVESTMENT PROJECTS
 

On November 26, 2014, the National Assembly approved the Law No. 67/2014/QH13 on Investment with many new contents that have strong effects on domestic and foreign investors. First of all, the Law regulated that only investment projects of foreign investors and economic organizations having  51%  or  more  of  their  charter  capital or   having  a  majority  of  their  general  partners  being  foreign individuals, for partnerships must carry out procedures for grant of investment registration certificates. Therefore, investment projects of domestic investors, investment in the form of capital contribution or share or capital contribution purchase of economic organizations and investment projects of economic organizations excluding cases mentioned above shall not carry out procedures for grant of investment registration certificates. Previously, only investment projects having the scale of under VND 15 billion and not being under the List of investment field not having to carry out this procedure.

DEVELOPING AND UPGRADING THE SOLUTION FOR THE INDUSTRY GROUPS
OF COMPETITIVE COMMODITIES

On January 13, 2015, the Prime Minister signed the Decision No. 32/QD-TTg approving the synchronous development and upgrading solution for the industries, sectors and value chains of production of competitive commodities such as: electronics and information technology, textile and garment, food processing, agricultural machineries, tourism and related services.

This Program points out that in 2015, fulfilling the study and identification of potential areas, competitive commodities and appropriate models for industry groups serving pilot development of 5 industry groups in 5 areas: Electronics and IT, textile and garment, food processing, agricultural machineries, tourism and related services; fulfilling the review of development strategies and/or solutions for all industries/sectors and economic zones in order to define the orientation for investment attraction in line with the development of all industry groups. By 2020: Basically, 5 pilot industry groups are established in the defined potential areas; completed investment attraction mechanism and/or policy, improved corporate capability, connected and