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Legal answers
Types and scope of transactions allowed to transaction between credit institutions operating foreign exchange
Answered

On March 31th, 2021, the State Bank of Vietnam issued Circular No. 02/2021/TT-NHNN instructs foreign currency transactions on the foreign currency market by credit institutions licensed to conduct foreign exchange operations.

Accordingly, this Circular prescribes the type and scope of transactions permitted for transactions between credit institutions engaging in foreign exchange transactions:

  1. Credit institutions are allowed to conduct spot transactions, period transactions, swap transactions, option transactions with other authorized credit institutions. 
  2. Credit institutions are allowed to conduct spot transactions, period transactions, swap transactions, sale option transactions with economic organizations
  3. Credit institutions are allowed to conduct spot transactions and period transactions with residents being other organizations and individuals.
  4. Credit institutions are allowed to conduct spot transactions with non-residents being organizations and individuals and term sale foreign currency transactions with non-residents.
  5. Credit institutions are allowed to conduct sale foreign currency transactions with non-residents being foreign investors owning Government bonds issued in Vietnam Dong in the domestic market to prevent exchange rate risk for an investor’s investment bond. 

This document takes effect from May 17, 2021. 

 

New regulations governing educational activities
Answered

On March 19, 2021, the Government issued Decree 23/2021/ND-CP guiding Clause 3, Article 37 and Article 39 of the Law on Employment regarding employment service centers and employment service enterprises (“Decree 23”).

In order to guide the Education Law 2019, on March 23, 2021, the Government issued Decree 24/2021/ND-CP regulating the management in preschool and public general education institutions. (“Decree 24“).

Accordingly, Articles 5, 6 and 7 of Decree 24 have new regulations on the management of educational activities, specifically as follows:

  1. For enrollment activities:

The educational institution enrolls according to the requirements of universal preschool education for children 5 years old, compulsory education for primary education, requests the universalization of lower secondary education according to regulations of the Law.

The educational institution is free to determine the enrollment method, the enrollment quota, the enrollment subject, and the enrollment area.

      2. Organize educational activities

Educational institutions may decide on the methods and forms of organizing educational activities to meet the objectives and requirements of the educational program, ensuring quality and efficiency.

Educational institutions are actively linked with higher education institutions, research institutions, vocational education institutions, businesses, business households, organizations, individuals and students’ families => to organize educational activities in accordance with local conditions as prescribed by law.

     3 . Financial, assets, organizational structure and staffing management

The management of finance, assets, organizational structure and personnel in educational institutions must comply with relevant laws.

Educational institutions can receive sponsorship from organizations and individuals to improve the quality of education and develop schools to ensure clearly the purpose of funding and use the funding sources for the right purposes, publicly, transparency in accordance with the law.

The rates of revenues for services and support of non-tuition education activities to meet the needs of learners comply with the resolution of the provincial People’s Council on the basis of the proposal of the Provincial People’s Committee in accordance with local practical conditions.

Decree 24 takes effect from May 15, 2021.

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New regulations on licensing conditions for employment services
Answered

On March 19, 2021, the Government issued Decree 23/2021/ND-CP guiding Clause 3, Article 37 and Article 39 of the Law on Employment regarding employment service centers and employment service enterprises (“Decree 23”).

Accordingly, Article 14 of Decree 23 has changed the conditions for granting an Employment Service License (“License“), including 3 main groups of conditions, as follows:

  1. Having a location for the head office or branch for the employment service organization to be owned by the enterprise or leased stably under a contract of 03 years (36 months) or more.
  2. The enterprise made a deposit of VND 300,000,000 (Three hundred million VND).
  3. The legal representative of an enterprise providing employment services must satisfy the following conditions:
  • Be an enterprise manager in accordance with the Law on Enterprises;
  • Not falling into one of the following cases: being examined for penal liability, being detained, serving a prison sentence, serving an administrative handling measure at a compulsory detoxification establishment or a forced education institution, escaping from residence, having limited or incapable of civil acts, having difficulty in understanding, mastering acts, being banned by court from holding positions, banned from practicing or doing work related to employment services;

       4. Possessing a university or higher degree or having worked directly as a professional or managing employment services or providing labor for 02 years (24 months) or more within 05 consecutive years before applying for licensing.

Decree 23 replaces the corresponding provisions on licensing conditions at:

Decree No. 52/2014/ND-CP regulating conditions and procedures for licensing employment service activities of employment service enterprises.

Articles 10 and 12 of Decree No. 140/2018/ND-CP amending and supplementing Decrees related to business investment conditions and administrative procedures under the state management scope of the Ministry of Labor – Invalids and Social Affairs.

Decree 23 takes effect from June 1, 2021.

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Increased training support for unemployment insurance payers
Answered

On March 31th, 2021, the Prime Minister issued Decision No.17/2021/QD-TTg regulating the vocational training support level for employees participating in unemployment insurance. This Decision takes effect from May 15, 2021. 

According to Decision No.77/2014/QD-TTg, the maximum support level is VND 1,000,000/person/month regardless of the training period, but the Decision No.17/2021/QD-TTg has specified as follows:

 

  • For participants of vocational training courses up to 03 months:

 

The support level is calculated according to the tuition fees of the vocational training institutions and the actual training time but must not exceed VND 4,500,000/person/ training course. 

 

  • For people participating in vocational training courses for more than 03 months:

 

The support level is calculated by month, the tuition fee rate and the actual time of vocational training but must not exceed VND 1,500,000/person/month. 

 

  • In case the employee participating in a vocational training course has days with insufficient months as prescribed by the vocational training institution, the number of days is calculated according to the following principles:

 

14 days or less is counted as 0. 5 months. 

15 days or more is counted as 01 month. 

 

To apply the tax extension policy in 2021, what procedures should Small and medium-sized enterprises carry out?
Answered

On April 19, 2021, the Government issued Decree 52/2021/ND-CP on extension of time limit for payment of value added tax, corporate income tax, personal income tax and land rental in 2021. (“Decree 52“), accordingly, Small and medium-sized enterprises (SMEs) are one of the subjects to be applied Decree 52.

However, to apply the tax extension policy in 2021, what procedures should SMEs carry out?

Decree 52/2021 stipulates that “Taxpayers determine by themselves and take responsibility for the request for extension to ensure the right subject is extended under this Decree.” The appendix attached to Decree No. 52/2021 on the Form of Application for deferred tax payment and land rental records: “Taxpayers must determine by themselves according to the provisions of the Law on support for SMEs No. 04/2017/QH14 and Decree No. 39/2018/ND-CP dated 11/3/2018 detailing a number of articles of the Law on Support for SMEs.

According to Article 11 of the Government’s Decree No. 39/2018/ND-CP dated March 11, 2018, detailing a number of articles of the Law on support for SMEs stipulates:

              “Article 11. Determination and declaration of small and medium enterprises

1.a SME shall base itself on the form provided in the Appendix enclosed herewith to self-determine and declare its size as a micro-enterprise or a small or medium-sized enterprise and submit it to the agency, organizations support SMEs. SMEs are responsible before the law for the declaration. ”

From the information cited above, to apply the tax extension policy in 2021, SMEs should:

Prepare: (1) Declaration identifying micro-enterprise, small-sized enterprise, medium-sized enterprise; (2) Request for extension of tax and land rental payment. Then, provide these documents to the Tax Authority to prove you’re a SME.

Decree 52 takes effect from the signing date, which is April 19, 2021.

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Small and medium-sized enterprises are allowed to extend the tax to be paid in 2021
Answered

On April 19, 2021, the Government issued Decree 52/2021/ND-CP on extension of time limit for payment of value added tax, corporate income tax, personal income tax and land rental in 2021. (“Decree 52“), accordingly, Small and medium-sized enterprises (SMEs) are one of the subjects to be applied Decree 52, specifically as follows:

SMEs are eligible for tax extension according to Decree 52:

According to Clause 4 Article 2 of Decree 52: SMEs are determined in accordance with the Law on SMEs support No. 04/2017/QH14 and Decree No. 39/2018/ND-CP dated March 11, 2018 of the Government on details of a number of articles of the Law on SMEs Support.

However, not all SMEs are eligible for tax extension under Decree 52. Specifically, under Clause 1, Article 4 of Decree 52/2021 to be considered for deferred tax under Decree 52. Taxpayers must also: Pay the deferred tax and land rental in full according to the provisions of Decree No. 41/2020/ND-CP and the corresponding arising late payment interest (if any) into the state budget before 30 July 2021. In which, Decree No. 41/2020/ND-CP was issued on April 8, 2020, providing for support enterprises overcome difficulties caused by the Covid-19 pandemic related to deferred tax and land rental to.

Decree 52 takes effect from the signing date, which is April 19, 2021.

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Things enterprises need to keep in mind when implementing the procedures to request VAT payment extension according to Decree 52/2021/ND-CP
Answered

On April 19, 2021, the Government issued Decree 52/2021/ND-CP on extension of time limit for payment of value added tax, corporate income tax, personal income tax and land rental in 2021. (“Decree 52“). The following will be the things that the enterprises should be considered when carrying out procedures to request VAT payment extension according to Decree 52.

  1. Time to be extended for VAT payment: It is 5 months from March to June 2021; quarter 1 and quarter 2, 2021. It is 04 months for the VAT of July 2021. It is 03 months for the VAT of August 2021.

      2.  Payment method: Only send once to the directly managed tax agency for all periods of the extended taxes.

  1. Method of implementation: taxpayers are allowed to choose as follows:

Taxpayers apply electronically to the web portal of tax authorities.

Taxpayers apply directly or by post to the tax authorities.

  1. Time of implementation: At the same time as time of filing monthly tax declaration (or quarterly).

Decree 52 takes effect from the signing date, which is April 19, 2021.

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Additional cases of fee exemption in the fields of exit, entry, transit, and residence in Vietnam
Answered

On April 7, 2021, the Ministry of Finance issued Circular 25/2021/TT-BTC regulating the rates, collection, payment, management and use of fees and charges in the fields of exit and entry, transit and residence in Vietnam (“Circular 25“). Circular 25 replaces Circular No. 219/2016/TT-BTC and Circular No. 41/2020/TT-BTC.

Accordingly, Article 5 of Circular 25 adds exemptions for fees and charges in the fields of exit, entry, transit and residence in Vietnam, specifically:

  • Invited guests (including spouse, children) of the Party, State, Government, National Assembly or leaders of the Party, State, Government or National Assembly as individuals.
  • Officers and employees of diplomatic missions, foreign consulates and representative offices of international organizations in Vietnam and members of their families (spouses and children under 18 years of age ), regardless of passport type, who is not a Vietnamese citizen and not permanently residing in Vietnam is not required to pay fees on the basis of reciprocity.
  • Free case under international treaties that Vietnam has signed or acceded to or on the principle of reciprocity.
  • Foreigners entering Vietnam to provide relief work or humanitarian assistance to Vietnamese organizations and individuals.
  • Free in case of issuing visas, temporary residence for foreigners in Vietnam who violate the law, are handled but have no financial ability and the representative agency of the country where the citizen does not bear the funding or not have a representative office of the country whose citizens violate the law in Vietnam. The determination of a foreigner in Vietnam who violates the law to be handled free of charge in this case shall be considered and decided by the toll collector in each specific case and shall take responsibility according to the provisions of law.

Note: In the cases that are exempt from fees and charges mentioned above, the collecting organization must stamp “Free of fees“, “Free of charge” (GRATIS) on the issued documents.

Special case: Exemption of passport issuance fee for overseas Vietnamese who have a written expulsion decision of a competent agency of the host country but do not have a passport; Overseas Vietnamese must return to their home countries according to international treaties or international agreements on the return of citizenship but do not have passports and other cases for humanitarian reasons.

Circular 25 takes effect from May 22, 2021.

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New regulations on electronic documents
Answered

On March 18, 2021, the Minister of Finance issued Circular No. 19/2021/TT-BTC guiding electronic transactions in the tax field. Accordingly, this Circular has new regulations on electronic documents. “Electronic document” is information created, sent, received and stored electronically when a taxpayer, tax authority, other relevant agency, organization or individual performs a transaction electronic tax. Electronic documents include:

    • Electronic tax records: tax registration documents; tax records; certify the fulfillment of tax obligations; check tax payment information; procedures for clearing tax, late payment interest, and fines overpaid; Profile refunds; tax exemption or reduction dossiers; exemption of late payment interest; no late payment fee is charged; tax debt freezing records; dossiers for deletion of tax arrears, late payment interest, and fines; tax payment extension; paying tax debt by installments and other tax documents and documents in electronic form prescribed in the Law on Tax Administration and guiding documents of the Law on Tax Administration.

 

  • Electronic State Budget (State Budget) payment documents: documents of payment to State budget as prescribed in Decree No. 11/2020 /ND-CP in electronic form, in case of tax payment electronically of a bank or intermediary payment service provider, the State budget remittance voucher is a transaction document of the bank or the intermediary payment service provider must ensure all information on the form State budget.
  • Notifications, decisions and other documents of tax authorities in electronic form.

 

Electronic documents must be digitally signed in accordance with the law.

This Circular takes effect on May 3, 2021.

New regulations on electronic tax transaction registration
Answered

On March 18, 2021, the Minister of Finance issued Circular No. 19/2021/TT-BTC guiding electronic transactions in the tax field. Accordingly, this Circular has new regulations on electronic tax transaction registration methods, including the following methods:

  • For registration of electronic tax transaction accounts with tax authorities: Web portal of General Department of Taxation.
  • Registration of transactions with tax authorities is done through the web portal of competent state agencies connected to the web portal of General Department of Taxation, including:
  1. Transaction registration with tax authorities electronically through the National Public Service Portal and the website of the Ministry of Finance.
  2. Register transactions with tax authorities electronically through the portal of other competent state agencies.

 

  • For registration of transactions with tax authorities electronically through the group service provider T-VAN.

 

  • For electronic tax registration procedures: Taxpayers register for electronic tax payment through the web portal of General Department of Taxation, or T-VAN service providers, at the same time must register to use the service tax payment service with the bank or the intermediary payment service supplier where the account is opened according to the regulations of the bank or the intermediary payment service supplier.

This Circular takes effect on May 3, 2021.