On 21 August 2012, the Ministry of Finance issued Circular 140/2012/TT-BTC (“Circular 140”) providing detailed guid-
ance on the fiscal stimulus measures for the 2012 year. This follows on fromDecree 60/2012 dated 30 July and Resolution
29/2012 of the National Assembly issued on 21 June. The initial details were covered in our NewsBrief of 25 June 2012.
To recap, the stimulus measures largely repeat those applied in 2011 and comprise the following:
A 30% reduction in 2012 corporate income tax (“CIT”) for:
a) small and medium enterprises (“SMEs”) (excluding those in certain sectors);
b) labour intensive enterprises (with more than 300 employees) operating in certain sectors.
CIT and value added tax (“VAT”) exemption for enterprises deriving income from providing shift
rations to workers.
Exemption from personal income tax (“PIT”) for the period 1 July to 31 December 2012 with respect to
individuals earning employment and business income within the 5% tax bracket (i.e. assessable amount
after tax relief does not exceed VND 5 million per month).
Exemption from fixed PIT and VAT for individuals deriving income from a) leasing accommodation to
workers and students; b) baby sitting services; and c) providing shift rations to workers.
For further explanation of what constitutes (or is excluded from) a qualifying SME or labour intensive
enterprise, please refer to our NewsBrief of 30 August 2011.
Circular 140 largely repeats the prior year guidance (per Circular 154/2011), but with a number of changes
Enterprises and individuals qualifying for CIT, VAT or PIT reduction or exemption are now required to file a
specific form with the local tax authorities.
There is guidance on how to determine the SME capital criteria for enterprises with financial years
different from the calendar year.
On 6 September the Ministry of Science and Technology (MoST) issued Official Letter (OL) 2527/TBBKHCN temporarily
prohibiting the import of certain used machinery, equipment and technology from China. The affected items fall into
the following industries:
• Producing iron, steel, alloy, coke coal
•Metallurgy of copper, lead, zinc, aluminium electrolysis
• Producing calcium carbide, chemical fibre, cement, flat glass
• Producing paper, spirit-alcohol, monosodium glutamate (MSG), acid citric
• Leather tanning, dying and printing.
OL 2527 does not apply to items imported but not used for production purposes, i.e. temporary import for
re-export, transit.
If a company would like to import such used goods, an application seeking approval fromMoST is required. The applica-
tion dossier comprises:
• Importation documents as per regulations, i.e. contract, invoice, packing list.
• Documents proving the origin of the used machinery, equipment and technology line, clearly
mentioning the production year, the production place, the year of beginning of usage, place of usage and
the entity that has used the machinery, equipment and technology line in the past.
This OL became effective from 15 September 2012.
(Souce: PwC)
Guidance on fiscal stimulus measures
Temporary suspension on importation of used machinery, equipment and technology lines
1,2,3,4,5,6,7 9,10