Chương 2 Luật thuế thu nhập doanh nghiệp 1997: Căn cứ tính thuế và thuế suất

Chapter II

BASES FOR TAX CALCULATION AND TAX RATES

Article 5.- Bases for tax calculation

Taxable incomes and tax rates are the bases for tax calculation.

Article 6.- Taxable incomes

Taxable incomes include incomes from production, business and service activities and other incomes, including those generated by production, business and service activities abroad.

Article 7.- Determination of taxable incomes

1. Taxable incomes from production, business and service activities are the turnover minus the reasonable costs related to the taxable incomes.

2. Other taxable incomes include incomes from differences of the stock trading, the rights to property ownership and use; interests from the transfer, lease or liquidation of properties, deposits, capital lending, selling foreign currencies; the year-end balance of reserves; the recovery of bad loans which have been written off from accounting records; debits of which owners cannot be identified; incomes from business activities of the previous years which have been omitted but later discovered, and other incomes.

In cases where an agreement on the avoidance of double taxation which the Socialist Republic of Vietnam has signed provides otherwise for the method to determine taxable incomes for permanent bases, such agreement shall apply.

Article 8.- Turnover

Turnover subject to the calculation of taxable incomes is the total sum earned from the sale of goods, remuneration from sub-contracts and the provision of services, including price subsidies.

In cases where the turnover is in a foreign currency, it must be converted into Vietnam Dong at the official exchange rate announced by the State Bank of Vietnam at the time of the collection of such foreign currency.

Article 9.- Costs

1. Reasonable costs to be subtracted for the calculation of the taxable incomes include:

a/ Depreciation of fixed assets used for production, business and service activities as prescribed by law;

b/ Cost of raw materials, materials, fuel, energy, and goods actually used in production, business and service activities, which is related to the taxable turnover and taxable incomes in the period and calculated on the basis of a reasonable waste rate and actual prices of delivery;

c/ Salaries, wages, half-time meal allowances, salary and wage-related incomes under current regulations, except for salaries and wages of the owners of private enterprises, owners of production, business and service individual households and incomes of founding members of companies who do not directly take part in running the production, business and service activities;

d/ Cost of scientific and technological research; innovation and modifications; allowances for education; health care; training of laborers according to the regulations;

e/ Cost of services bought from outside: electricity, water, telephone; repair of fixed assets; rents of fixed assets; audit; property insurance; payments for the use of technical materials, patents, licenses of technologies not belonging to fixed assets; technical services;

f/ Payment for women laborers as prescribed by law; spendings on labor protection; spendings on security of the establishment; deductions for the payment of social insurance and medical insurance under the liability of the laborer-employing business establishment; trade union fund; deductions to set up the higher agency's management fund according to regulations;

g/ Payment of interests on capital borrowings for production, business and services to banks and credit organizations at the actual interest rates; payment of interests on borrowings from other objects at the actual interest rate which must not exceed the floor interest rate set by the State Bank of Vietnam for credit organizations;

h/ Deductions for reserves as prescribed;

i/ Severance allowances for laborers;

j/ Spending on the sale of goods and services;

k/ Cost of advertisement, marketing and trade promotion directly related to production, business and service activities and other costs which must be kept below 7% of the total cost. With regard to commercial activities, the total cost serving as basis for the determination of the limit level of reasonable costs shall not include the input prices of goods for sale;

l/ Taxes, fees, charges and land rents to be paid, which are related to production, business and service activities, shall be included in the cost;

m/ Cost of business management allocated by foreign companies to their permanent bases in Vietnam as prescribed by the Government.

2. The following expenditures shall not be included in the reasonable costs:

a/ Advance deductions included in the total cost but actually not spent;

b/ Expenditures without vouchers or with invalid vouchers;

c/ Fines and expenditures which are not related to the taxable turnover and taxable incomes;

d/ Expenditures covered by other capital sources.

3. The reasonable costs prescribed in Item 1 of this Article shall all be recorded in accounting books in Vietnam Dong. In case of a cost in foreign currency, it must be converted into Vietnam Dong at the official exchange rate announced by the State Bank of Vietnam at the time when the cost is paid.

Article 10.- Tax rates

1. The enterprise income tax rate applicable to domestic business establishments and foreign organizations and individuals doing business in Vietnam not under the Law on Foreign Investment in Vietnam shall be 32%.

Production, construction and transport establishments that are paying turnover tax at the rate of 25%, now pay enterprise income tax at the rate of 32% and, if facing difficulties, shall enjoy a tax rate of 25% for three years from the date when this Law takes effect; upon the expiry of this period, the 32% tax rate shall apply. The Government shall determine which production, construction and transport establishments may enjoy the tax rate of 25%.

Business establishments, which earn high incomes thanks to their objective advantages, shall, beside paying 32% income tax, have to pay an additional income tax equivalent to 25% of the exceeding incomes brought about by their objective advantages. The Government shall prescribe the method to determine such excess amount of incomes.

With regard to new investment projects in the fields, branches and trades and territorial areas where investment is encouraged, the tax rates of 25%, 20% and 15% shall apply in accordance with the provisions of the Government.

2. The enterprise income tax rate applicable to foreign invested enterprises and foreign parties to business cooperation contracts shall comply with the tax rate provided for in Article 38 of the Law on Foreign Investment in Vietnam.

When transferring their incomes abroad, foreign investors shall have to pay tax for the transferred incomes at the tax rate provided for in Article 43 of the Law on Foreign Investment in Vietnam.

Such terms as "loi tuc" (interests) and "loi nhuan" (profits) written in Article 38 and Article 43 of the Law on Foreign Investment in Vietnam shall be construed, according to this Law, as "incomes" to serve as basis for the tax calculation.

3. The enterprise income tax rate applicable to domestic and foreign organizations and individuals conducting oil and gas prospection, exploration and exploitation shall be 50%; a tax rate of from 32% to 50% may apply to the exploitation of other precious and rare natural resources, depending on each project and each business establishment.

The Government shall give more specifications to this Article.