HA NOI (VNS)— Tax delays and corporate income tax reductions are among the major measures proposed by the Ministry of Finance to alleviate difficulties for businesses next year.
The ministry suggests setting a 10 per cent corporate income tax from July 1 2013, six months earlier than initially planned. This will also be applied to investors working on social housing–apartment projects for low income people.
The businesses dealing with social houses and apartments (of below 70sq.m which are sold at less than 15 million per sq.m) will enjoy value added tax reductions of 50 and 30 per cent respectively. The regulation will be applicable from July 1, 2013 to June 30, 2014.
For the next two years, the ministry also recommends halving land lease payments for businesses, households and individuals who rent State land.
Construction investors who fail to pay land leases due to financial difficulties can make payments according to their sales income. However, they are allowed to delay payment for a maximum period of 24 months if tax institutions receive notification.
The ministry also proposes a six month extension for next year's first quarter corporate income tax payments, as well as three months for the second and third quarters. This regulation targets small and medium-sized enterprises which employ less than 200 full time workers and whose revenues do not exceed VND20 billion (US$900,000) per year.
Enterprises with more than 300 employees and who are specialising in forestry, agricultural and seafood products, garment production, shoes, electronic parts and infrastructure construction will also be subject to delayed income tax payment. Property investors and dealers will also be granted the extension.
Tax payment extension will not apply to businesses which are subject to special income tax, for example financial institutions, banks, insurance companies, stock markets and lotteries. — VNS