Foreign-invested businesses top all others in 2014 social insurance debt in Vietnam: report

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Foreign-invested enterprises (FIEs) and foreign organizations last year topped all other economic sectors of Vietnam’s economy in social insurance debt with over VND2.13 trillion (US$97.9 million), according to a government report on the management and use of social insurance funds in 2014. This was a staggering 192.5 percent year-on-year surge, according to the report submitted recently to the ongoing National Assembly meeting, which kicked off in Hanoi on Wednesday. The foreign sector was followed by the non-state sector which owed about VND1.9 trillion ($87.4 million), down about 50 percent compared to the rate of over VND3.8 trillion in the previous year. The non-state sector held the top position in social insurance debt in 2013 as the debt it owed accounting for about 16 percent of total social insurance debts that should be recovered, according to the report. In general, the government said in the report that the balance of the country’s social insurance … [Read more...]

Government News 22/5

Smuggling, trade fraud worsen national economy: PM Smuggling, trade fraud and counterfeit goods are seriously damaging the national economy and negatively affecting society, stated Prime Minister Nguyen Tan Dung at a teleconference on tobacco smuggling. Chairing the May 21 teleconference reviewing the six-month implementation of a Government decree on intensifying the fight against tobacco smuggling, the PM said the Government always considers combating smuggling and trade fraud a key task. He asked ministries and localities to synchronously carry out measures to fight tobacco smuggling, with the focus on ringleaders. The Government leader stressed the need to strictly address sales of contraband tobacco, while intensifying communications to raise public awareness of tobacco trafficking. Disseminating the bad impacts of smoking among the public, particularly among the young, is also essential, he added. Ministries and localities were also asked to prevent smuggling activities at … [Read more...]

Smugglings, trade frauds worsen national economy: PM

PM Nguyen Tan Dung addresses the teleconference. Photo: chinhphu.vn

Smugglings, trade frauds and counterfeit goods are seriously damaging the national economy and negatively affecting society, stated Prime Minister Nguyen Tan Dung at a teleconference on tobacco smuggling. Chairing the May 21 teleconference reviewing the six-month implementation of a Government decree on intensifying the fight against tobacco smugglings, the PM said the Government always considers combating smugglings and trade frauds a key task. He asked ministries and localities to synchronously carry out measures to fight tobacco smugglings, with the focus on ringleaders. The Government leader stressed the need to strictly address sales of contraband tobacco, while intensifying communications to raise public awareness of tobacco trafficking. Disseminating the bad impacts of smoking among the public, particularly among the young, is also essential, he added. Ministries and localities were also asked to prevent smuggling activities at border areas, and at the same time improve … [Read more...]

Smuggling, trade fraud worsen national economy: PM

PM Nguyen Tan Dung chairs the teleconference on tobacco smuggling. (Photo: VNA) Smuggling, trade fraud and counterfeit goods are seriously damaging the national economy and negatively affecting society, stated Prime Minister Nguyen Tan Dung at a teleconference on tobacco smuggling. Chairing the May 21 teleconference reviewing the six-month implementation of a Government decree on intensifying the fight against tobacco smuggling, the PM said the Government always considers combating smuggling and trade fraud a key task. He asked ministries and localities to synchronously carry out measures to fight tobacco smuggling, with the focus on ringleaders. The Government leader stressed the need to strictly address sales of contraband tobacco, while intensifying communications to raise public awareness of tobacco trafficking. Disseminating the bad impacts of smoking among the public, particularly among the young, is also essential, he added. Ministries and localities were also asked … [Read more...]

Finance Ministry to issue bond-for-debt swap

The Ministry of Finance (MoF) has asked the Government of Viet Nam to issue new Government bonds in the international capital markets for debt rescheduling. MoF asks the Government of Viet Nam to issue new Government bonds in the international capital markets for debt rescheduling.-Photo Vietstock.vn MoF Deputy Do Hoang Anh Tuan said at the Government's regular meeting on April 25 that a draft resolution for the issuance during the period 2016 to 2020 period had been submitted to Prime Minister Nguyen Tan Dung for his approval. Tuan said the bond-for-debt swap would raise funds for developing the country's economy, implement key projects and restructure foreign debt. He added that the issuance would not exceed 65 per cent of the GDP or the debt ceiling during the next five years. The Minister-Chairman of the Government Office, Nguyen Van Nen, said the bond-for-debt swap was a normal operation, adding it would restructure debts in a sustainable and more efficient way. Late in … [Read more...]

Vietnam plans to sell more bonds abroad next year: report

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A man walks past the Hanoi Stock Exchange in Hanoi. Photo: Bloomberg The Ministry of Finance has advised the government to continue issuing more bonds next year to refinance existing debts and raise funds for long-term projects, local media reported. Deputy Finance Minister Do Hoang Anh Tuan did not reveal how much the bonds are worth and whether the borrowings are denominated in US dollar, euro or another currency. He was quoted as saying that the plan will not affect Vietnam's public debt position, which will not exceed 65 percent of the country's gross domestic product by 2020 and beyond. Vietnam's public debt-to-GDP ratio was estimated at 54.2 percent in 2013 and 60.3 percent last year. According to Tuan, the upcoming bond issue will take advantage of falling borrowing costs, allowing the country to refinance existing loans. Vietnam's credit rating has improved recently, raised from B2 to B1 by Moody's and from BB- to B+ by Fitch, he noted. The new bonds will also help fund … [Read more...]

Honda Vietnam at odds with ministry over almost $10mn tax arrears

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The Vietnamese unit of motor maker Honda and the Ministry of Finance still fail to reach an agreement on a preferential tax treatment the company is supposed to enjoy, thanks to which it refuses to pay nearly US$10 million in tax arrears. Honda Vietnam Co. Ltd. has been asked to pay VND182 billion ($8.48 million) in tax arrears and fines, Deputy Minister of Finance Do Hoang Anh Tuan said at a government meeting on Saturday. While the company has followed the order, it still owes "a large sum of money" to the state budget, Tuan added without elaborating the violations of the motor manufacturer. Honda Vietnam went under a tax inspection in 2014, and was eventually asked to pay nearly VND400 billion ($18.64 million) in tax debts and fines, another finance ministry official told Tuoi Tre (Youth) newspaper on Sunday. The company, which has two motor-manufacturing plants and a car-making facility in Vietnam, has so far paid only VND182 billion of the sum, and thus still owes around … [Read more...]

General Department of Taxation Implements Resolution 19/NQ-CP

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As of January 2015, after implementing many solutions, the General Department of Taxation has reduced the number of hours of tax compliance by 370 hours a year. This result means that the sector will need to continue to cut down another 45.5 hours to reach the average tax time of the ASEAN-6, which is 171 hours a year including time of social insurance payment, that is 49.5 hours. On April 6, the General Department of Taxation held an online conference on the implementation of the government’s Resolution 19/NQ-CP in 2015 and to sum up the refund work of value-added tax (VAT) in 2014. Finance Minister Dinh Tien Dung chaired the conference. Participating in this online conference were also Deputy Minister of Finance Do Hoang Anh Tuan and 62 local tax departments across the nation. Reporting the results of implementing Resolution 19 of the government, Mr Cao Anh Tuan, Deputy Director of the General Department of Taxation said that shortly after the issue of Resolution 19, Minister … [Read more...]

Coordination in Tax, Customs Monitoring

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Recently, the Steering Committee of the Central Committee of Vietnam Fatherland Front (VFF), led by VFF Chairman Nguyen Thien Nhan, paid a working visit to the Ministry of Finance and member organisations engaged in the joint tax and customs supervision programme. The programme, aimed to carry out tasks and solutions to improve the business environment and enhance national competitiveness in tax and customs fields, is joined by the Vietnam Chamber of Commerce and Industry (VCCI), the Vietnam Cooperative Alliance, the Vietnam Association of Small and Medium Enterprises, and the Vietnam Association of Young Entrepreneurs.Appreciation from business community VCCI President Vu Tien Loc said that the financial sector is at the forefront of serving the business community through tax and customs affairs. The business community showed its appreciation for the financial sector for its effective and practical operations. The financial sector needs to raise public intelligence for administrative … [Read more...]

Tax reforms to target better business climate

The General Department of Taxation said during an online meeting on April 6 that it would step up tax reforms to improve the business environment. The department plans to cut at least 10 per cent of tax administrative procedures and simplify at least 20% of the current procedures to reduce tax filing hours to 121.5 hours per year as per a Government Resolution or to 171 hours per year (included social insurance filing hours). As of January 2015, tax filing hours were reduced by 370 hours per year and must be cut by another 45.5 hours to reach the average level of ASEAN-6. The Minister of Finance Dinh Tien Dung said at a meeting detailing measures that a determination from the tax agencies was needed to achieve the target. The General Department of Taxation said the application of information and technology would be hastened during tax filings going forward, adding that IT applications would be implemented before June 30. Specifically, 60% of tax refund filings and tax … [Read more...]

Vietnam strives for big tax reform

Deputy Prime Minister Vu Van Ninh said every province strives to implement an e-tax service to cut tax declaration procedural times to 171 hours per year in 2015. Under Ninh's instructions laid out in a recent tax review meeting, all tax departments must continue reviewing and minimising paperwork to create favourable conditions for taxpayers. The Government is strongly determined to implement online tax declarations, as Vietnam is one of the countries that spends the greatest amount of time on tax procedures, with 872 hours spent annually for each small and medium-sized enterprise, according to Nguyen Thi Cuc, Chairwoman of the Vietnam Tax Consultancy Association (VTCA). This figure is four times higher than that of many other Southeast Asian countries. Indonesia spends 259 hours, Thailand 264 hours, Malaysia 133 hours and Singapore 82 hours. Vietnam ranks 149th out of 189 nations in terms of time required to complete tax payments. According to Deputy Finance Minister Do … [Read more...]

VN strives for big tax reform

People pay tax at a branch of Ha Noi Tax Department. All tax departments need to implement the e-tax service to cut down tax declaration procedural times. — VNA/VNS Photo HA NOI (Biz Hub) — Deputy Prime Minister Vu Van Ninh said every province would strive to implement an e-tax service to cut tax declaration procedural times to 171 hours per year in 2015. Under Ninh's instructions, laid out in a tax review meeting in February, all tax departments must continue reviewing and minimizing paperwork to create favourable conditions for taxpayers. The Government is strongly determined to implement online tax declarations, as Viet Nam is one of the countries that spends the greatest amount of time on tax procedures, with 872 hours spent annually for each small and medium-sized enterprise, according to Nguyen Thi Cuc, chairwoman of the Viet Nam Tax Consultancy Association (VTCA). This figure is four times higher than that of many other Southeast Asian countries. Indonesia spends … [Read more...]

Ho Chi Minh City surpasses revenue targets

Ho Chi Minh City. — File Photo

Budget revenue for HCM City last year reached VND164.23 trillion (US$7.7 billion), 8 per cent higher than the year's target and a year-on-year increase of 4.73 per cent. The figures were released during a conference held last Friday to review tax operations in HCM City. Le Xuan Duong, deputy head of the HCM City's Tax Department, said last year domestic revenue (excluding budget collections from crude oil) exceeded the target to reach VND129.5 trillion ($6.07 billion), an increase of nearly 9 per cent over the previous year and four per cent higher than the year's target. The budget collection from the economic sector in the city, for the first time, surpassed the city's target last year to top $92.5 trillion ($4.3 billion), accounting for more than 70 per cent of total domestic revenue. Le Thanh Hai, secretary of the Party Committee of HCM City, said tax collection from the city's four key industrial sectors had increased significantly over the past years and contributed up to … [Read more...]

Uber must pay 5pct income tax on total revenue in Vietnam: ministry

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Uber will have to pay tax if it is licensed for legally operating in Vietnam, said a senior state official from the Ministry of Finance on Wednesday. If being licensed for legally operating in Vietnam, Uber will have to pay 5 percent income tax on total revenues it gain from the local market, said Deputy Minister of Finance Do Hoang Anh Tuan, citing General Taxation Department’s calculation. Accordant to the General Taxation Department under the ministry, Uber International BV, which enjoy 20 percent of the total the payments of passengers for using Uber services, will have to pay 5 percent value added tax and 5 percent corporate income tax on total revenues it gains from the local market. For the local transport firms directly contracting with Uber International BV, they will have to pay tax worth 80 percent of their earnings from using Uber service through banks. In addition, those businesses will also be charged with some other kinds of fees and all other kinds of … [Read more...]

Vietnam doesn’t sell crude oil below production costs

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VietNamNet Bridge – Vietnamese officials and experts have denied that the world’s oil price has dropped to below $55, while the exploitation cost in Vietnam is $50-70 per barrel. Bloomberg newswire has quoted BP-sourced figures as reporting that the crude oil reserves in Vietnam are the second largest in East Asia, just under China, with 4.4 billion barrels, or 630 million tons. The black gold brings high revenue to the country’s budget, and therefore, the 40 percent oil price fall since July has forced ministries to discuss the way out. The Ministry of Planning and Investment (MPI) said that it costs $30-70 to exploit a barrel of crude oil. The figure coincides with the HCM City Securities Company’s report that $50 is the break-even point for PetroVietnam, the national oil & gas group. With this production cost, Vietnam would only make a profit if it can sell crude oil at above $70 per barrel. According to the General Department of Customs (GDC), … [Read more...]

Authorities mitigate impact of falling oil price to State budget

The government will implement comprehensive measures to meet next year's annual state budget collection target of VND911.1 trillion (US$42.774 billion), notwithstanding the insignificant effect of the global oil price decline. Some experts are concerned about the reduction of the state's budget next year as the export value of crude oil, which has fallen by 30% to a four-year low of roughly $60 per barrel, contributes significantly to the nation's coffee. However, Deputy Finance Minister Do Hoang Anh Tuan said that as of 2014, the state coffer has not been heavily dependent on the fluctuation of the world's oil price due to a shift in the state's budget collection sources. Tuan explained that the oil export revenue is estimated to account for only approximately 10.2% of the total state budget in 2014 compared with the previous 20–25% rate. State budget collection from domestic production makes up more than 70% of the total budget, which diminishes the gravity of the impact of … [Read more...]

MOF to raise taxes to offset losses from oil export revenue

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VietNamNet Bridge – The Ministry of Finance (MOF) has sharply raised the tariff on petrol imports in order to cope with plummeting crude oil prices. The Ministry of Industry and Trade (MOIT) reported great success in crude oil exports for 2014, estimating an export volume of 7,549 tons and export turnover of $6.802 billion. MOF has reported a 12 percent increase over the estimated collection for the state budget, and a 14-15 percent higher collection rate from oil exports alone. However, if the oil price keeps falling, according to Do Hoang Anh Tuan, MOF Deputy Minister, the State will lose VND1 trillion in 2015 budget revenue for every one dollar in the drop in oil prices. If the oil price hovers around $80 per barrel, Vietnam would lose VND20 trillion in taxes, including 10 percent crude oil export tax, natural resource tax, corporate income tax and other kinds of fees and charges. The oil price plunge has reminded people of the 2009 oil crisis. The oil price has … [Read more...]

Viet Nam to perfect tax and customs policies

Representative from Ministry of Finance and European Chamber of Commerce in Vietnam at the event. — Photo mof.gov.vn

HA NOI (Biz Hub) — Viet Nam is in the process of implementing reforms in its tax and customs administration, Deputy Minister of Finance Do Hoang Anh Tuan said in a meeting here last week. The reforms are expected to create a transparent business environment for European investments in Viet Nam. The meeting was themed "Dialogue on tax, customs and transfer pricing." Participants discussed the issues encountered by European businesses in Viet Nam. The event was jointly organised by the Ministry of Finance (MOF) and the European Chamber of Commerce in Vietnam (Eurocham). Thomas McClelland, Eurocham's chairman of taxation and transfer pricing sector committee, raised five issues faced by European businesses, including accounting, taxation preferential measures and value added tax on export services. McClelland disclosed that European businesses in Viet Nam were concerned about the issue of foreign contractor taxes being paid on warranty services. Meanwhile, Deputy Minister Tuan … [Read more...]

PVN extracts more crude despite falling prices

An offshore oilrig operated by Vietnamese-Russian oil firm Vietsovpetro. PVN has extracted more crude oil than the target although oil prices have kept falling on global markets - PHOTO: TTXVN

Ngoc Lan A source from PVN said the group has realized the target to pump 16.21 million tons of crude oil from domestic and foreign fields as assigned by the Government and 9.5 billion cubic meters of gas as of December 9. The volume from the oil fields within Vietnam was 14.37 million tons. … [Read more...]

Vietnam introduces ‘single-door’ customs clearance mechanism

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Vietnam on Wednesday unveiled a simplified customs procedure at three international seaports, claiming it will help cut customs clearance time by up to four days. The new mechanism was kicked off by Deputy Prime Minister Vu Van Ninh during a ceremony in Hanoi, and is being applied at the ports in the northern city of Hai Phong, as well as Ho Chi Minh City and Ba Ria-Vung Tau Province in the south. … [Read more...]