ENTERPRISES HURT BY COVID-19 PROPOSED FIVE MONTHS TAX PAYMENT LENIENCY

Enterprises and individuals directly affected by the novel coronavirus (COVID-19) would be allowed to pay value-added tax (VAT) or land rent five months late, according to the proposal of the Ministry of Finance.

In the draft decree extending the deadline for tax and land rent payment, the Ministry of Finance (MoF) assessed that most industries and sectors, especially micro- and small-sized enterprises, individuals, groups of individuals, production households, and businesses are affected by the COVID-19.

Therefore, the MoF proposes extending payment deadlines by five months to businesses, organisations, individuals, groups of individuals, and households directly affected.

The subjects eligible for this extension those working in agriculture, forestry and fishery production, food processing, weaving, clothing production, shoe and footwear production, rubber products production, manufacturing electronic products, computers, manufacturing and assembling automobiles (except for manufacturing and assembling cars with less than nine seats).

The extension also applies to rail, road, waterway, aviation, warehousing, and other supporting activities for transportation, accommodation, catering and other activities of travel agencies, as well as tour and support services.

In addition, micro- and small-sized enterprises defined in the Law on Support for Small- and Medium-sized Enterprises are also entitled to this policy.

Enterprises would be eligible for an extension on VAT payments in the first and second quarter of 2020. It is estimated that the payment of about VND22.6 trillion ($982.6 million) of tax from enterprises will be extended for five months.

In addition, about VND3 trillion ($130.43 million) of VAT and personal income tax payable in 2020 by individuals, groups of individuals, and business households are also extended to December 15.

In addition, the MoF proposed to extend the land rent payments by five months for payments due in the first quarterof 2020. Extended land rent is expected at about VND4.5 trillion ($195.65 million). However, the revenue of the state budget in 2020 will not decrease due to business households and individuals still having to pay for the budget before October 31.

In spite of the extended schedule, taxpayers still have to declare and submit tax returns according to current regulations.

Source: VIR