POLICIES EFFECTIVE SINCE FEBRUARY, 2018

A string of policies on business income, social insurance, logistics, digital signatures, unbaked materials come into effect from February, 2018.

Amendments of corporate income tax

Decree 146/2017/ND-CP amends and supplements some articles of Decree 100/2016/ND-CP and Decree 12/2015/ND-CP regulating that life insurance premiums for the employees are deductible; contributions to pension funds and pension insurance are subject to a cap of VND3 million/month/person (instead of VND 1 million in the formal regulation).  

In addition, if in a month (for case of monthly declaration), in a quarter (for case of quarterly declaration), a business establishment has exported goods or services including the following cases: imported goods which are then exported to non-tariff areas; and imported goods which are then exported overseas with the input VAT of VND 300 million or more which have been not deducted, it shall be entitled to a monthly or quarterly VAT refund.

Amendments of social insurance regulations

Decree 161/2017/ND-CP amends Article 12 of Decree 21/2016/ND-CP dated March 31, 2016 regulating the specialized inspection by social insurance agencies of contributions to social insurance, medical insurance and unemployment insurance.

Accordingly, since February 15, social insurance agencies will no longer be permitted to extract a part of fine punishment of slow insurance payment to support their investigation capacity.  

Updated regulations on logistics

Decree 163/2017/ND-CP of the Government on logistics service business shall come into effect on February 20, stipulating compensation obligations of logistics enterprises for customers.  

In terms of business conditions of logistics services, traders dealing in specific services belonging to logistics services must meet the investment and business conditions prescribed by law for such services.

Where the relevant law does not provide for the limitation of liability, the liability of the logistics service trader shall be limited by the parties' agreement. In cases where the parties have no agreement, the following shall be applied: In cases where customers have no advance notice on the goods value, the maximum liability limit shall be VND 500 million for each claim; Where the customer has given advance notice of the value of the goods and is certified by a logistics service trader, the limit of liability shall not exceed the value of the goods.

Preferential investment at Da Nang High-Tech Park

Decree 04/2018/ND-CP of the Government regulating preferential mechanisms and policies for the Da Nang Hi-Tech Park shall officially take effect from February 20.

New investment projects in the park shall enjoy an incentive corporate income tax rate of 10% in 15 years.

Especially, any new project with a total investment capital of VND 3 trillion (over US$ 132 million) or above shall enjoy a rate of 10% for a period of 30 years.  In addition, these projects will be entitled to corporate income tax exemption for 4 first years of their operation, and a 50% tax reduction for 9 subsequent years.

Land lease fee exemptions for the entire term shall be applied to projects using land to develop civil engineering and technical infrastructure works, tree planting areas, public parks, facilities for State-owned agencies, hi-tech human resource training centers, accommodations for experts and employees working in the park and other projects involved in a list of priority aspects.

Compulsory amounts of unbaked building materials used in constructions

This is the most notable provision of the Circular 13/2017/TT-BXD providing for use of unbaked building materials in constructions (which is coming into force from February 01, 2018).

According to the Circular, the compulsory amounts of unbaked building materials used in state-funded constructions are as follow:

- For provinces of the Northern midland and mountainous region and the southeast:

+ At least 90% if the construction is built at an urban area of class III or a higher class;

+ At least 70% if the construction is built at any remaining area.

- For other provinces:

+ At least 70% if the construction is built at an urban area of class III or a higher class;

+ At least 50% if the construction is built at any remaining area.

(Currently, 100% of building materials used in these constructions must be unbaked building materials).

- At least 80% of total amount of building materials used in a building comprising 9 stories or higher must be unbaked building materials regardless of its funding source (It is increased by 30% of the current compulsory amount).

The compulsory amount of unbaked building materials used in constructions built in either Ha N or Ho Chi Minh City is kept unchanged as 100%.  

Regulations on digital signatures on electronic documents of regulatory agencies​

Circular No. 41/2017/TT-BTTTT providing for digital signatures on electronic documents of regulatory agencies is coming into force from February 5, 2018.

According to the Circular, digital signatures shall be applied to electronic documents by using the digital signature software which shall automatically give a notification of whether the digital signing process has been successful or not.  If a competent person is required to apply the digital signature to an electronic document, he/she shall use the digital signature software and personal private key to digitally sign the electronic document.

If a regulatory agency or organization applies a digital signature to an electronic document, that regulatory agency or organization shall use the digital signature software and its secret seal key to digitally sign that electronic document.

Source: VGP