Personal income tax Q&A, period 3, December

(Baonghean) - Question: Request the Tax Department to inform about the amendments and supplements to VAT, Resource Tax, and Corporate Income Tax stipulated in the Law amending and supplementing a number of articles of the Laws on Taxes.

Reply:On November 26, 2014, at the 8th session, the 13th National Assembly passed the Law amending and supplementing a number of articles of the Tax Laws No. 71/2014/QH13. The Law takes effect from January 1, 2015.

Some revised contents on VAT, Resource tax, and corporate income tax are stipulated as follows:

I/ About value added tax (VAT)

To contribute to encouraging the development of the agricultural sector, creating conditions for fishing boat owners to stay at sea and remove difficulties, contributing to promoting enterprises to participate in socialized fields, the Law has been amended and supplemented with the following provisions:

1/ Add the subjects not subject to VAT for the activities of building new offshore fishing vessels.

2/ Change 3 groups of goods subject to VAT at the rate of 5% to those not subject to VAT: Fertilizer; Animal feed, poultry, pets; Specialized machinery and equipment for agricultural production. From January 1, 2015, enterprises paying VAT according to the deduction method when selling these 3 groups of goods when making invoices, the tax rate line is not crossed out and input VAT is not deducted.

II/ About resource tax

The law stipulates: Change from tax-exempt to non-taxable subjects for natural water used for agriculture, forestry, and salt production.

III/ On corporate income tax (CIT)

1/ Regarding deductible and non-deductible expenses when calculating corporate income tax.

- Additional expenses for vocational education activities are included in deductible expenses.

- Remove the 15% control on total costs for promotion, advertising, reception, customer service... stipulated in Point m, Clause 2, Article 9 of Corporate Income Tax Law No. 32/2013/QH13.

2/ Regarding corporate income tax incentives:

Apply a tax rate of 15% to: income of enterprises growing crops, raising livestock, and processing in the agricultural and aquatic sectors not located in areas with difficult socio-economic conditions or areas with particularly difficult socio-economic conditions. (Currently, preferential tax rates are not applied)./.

NGHE AN TAX DEPARTMENT