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Covid-19 / Treasury & Capital Markets
Vietnam orders tax exemptions, reductions amid fresh Covid-19 outbreaks
Support measures aimed at supporting people and businesses affected by pandemic-related restrictions
Nguyen Tuong Thuy 10 Aug 2021

Vietnam’s Prime Minister Pham Minh Chinh has ordered tax and fee exemptions and reductions to support the people and businesses affected by the Covid-19 pandemic. Since May, the Southeast Asian country has been struggling to curb fresh outbreaks of the fast-spreading Delta variant of the coronavirus.

Ho Chi Minh City, the country's economic hub and most populated metropolis, has become the hardest hit. A stay-at-home order was implemented in the city on May 31, which was followed by much harsher regulations in the succeeding weeks. Neighbouring provinces such as Binh Duong, Dong Nai and Ba Ria-Vung Tau in the southern key economic region have also suffered deep economic scarring.

On Sunday (August 8), the Vietnamese PM convened a virtual cabinet meeting, which was also attended by representatives from companies, business associations and provincial authorities, to discuss ways to support companies and the general public during the crisis.

The Ministry of Finance was told to carry out tax exemptions and reductions for the year. The Ministry of Planning and Investment (MPI) was asked to come up with timely solutions to the socio-economic challenges posed by the pandemic. MPI Minister Nguyen Chi Dung told the online meeting that a task force would be set up immediately to undertake support measures, with priority to be given to small and medium-sized enterprises (SMEs).

The Ministry of Transport was ordered to take urgent measures to ensure the circulation of goods across the country. The Ministry of Health will coordinate with relevant ministries and sectors to effectively implement the country’s vaccine strategy, including promoting public-private cooperation and speeding up vaccinations in line with the order of priority.

“We set the highest goal is to prevent health and socio-economic crises from happening, ensure the health and life of the people first, and strive to bring life back to normal in the shortest time, no later than the end of 2021 or early 2022,” says PM Chinh.

This April, the government issued Decree 52 extending the deadlines for the payment of taxes and land rental fees for the 2021 tax year. Like Decree 41, which was issued last year, the law aims to support companies and businesses affected by the pandemic.

As for value added tax, Decree 52 grants corporate taxpayers a five-month deferral. VAT declaration, originally with an April deadline, has been moved back to September. Meanwhile, corporate income tax payments for the first and second quarters are extended by three months. The deadline for VAT and personal income tax payments for individuals and business households such as SMEs is extended to December 31 2021.

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