Over the past 30 years, foreign-invested companies have been given many incentives and have become a major drive of Vietnam’s economy. But tax regulations over them remain limited, especially with regards to non-transparent financial statements, false loss reports and tax evasion through transfer pricing. According to the Department of Corporate Finance under the Ministry of Finance, as of early 2018, Vietnam had 24,748 active foreign direct investment (FDI) projects with total investment pledges at US$318.72 billion and disbursement at US$172.35 billion. FDI enterprises come from over 100 countries and territories worldwide and are present in every province and centrally-governed city in Vietnam, operating in a wide range of fields, from manufacturing to construction, services and agriculture. Their investment accounts for one quarter of Vietnam’s total investment, while contributing 18.59 pct of the country’s total economic output, 19 pct of government income and 70 pct of the total exports. FDI enterprises have also created an estimated 4 million jobs. However, statistics show that among the 17,493 FDI enterprises operating in Vietnam, as of the end of 2016, only roughly 14,400 submitted their financial statements to the Vietnamese authorities, of which only 12,589 included all of the necessary information for analysis of… Read full this story
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