March 2022 Tax Updates: Amending several provisions of the Law on Enterprises and the Law on Investment.

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March 2022 Tax Updates: Amending several provisions of the Law on Enterprises and the Law on Investment

This March 2022 publication of our Tax and Accounting Updates looks at amending several provisions of the Law on Enterprises and the Law on Investment, promulgation of rules of origins in the RCEP Agreement, e-invoices to be mandatory from April 2022, and stopping supporting union members and employees affected by COVID-19 by the union from 1 March 2022

Amending several provisions of the Law on Enterprises and the Law on Investment

A new Law was recently issued, amending several provisions of the Law on Enterprises and the Law on Investment.

The Law on Investment

Specifically, in Clause 5, Article 3, the business lines of network security products and services (excluding trading in network information security products and services and trading in civil cryptographic products and services) are added to be conditional business lines.

Trading in network security products and services is added at ordinal number 132a, after ordinal number 132 of Appendix IV on the list of conditional business lines.

The Law on Enterprises

In Article 7, the Law amends and supplements some contents of the Law on Enterprises as follows:

  • Amendment of regulations on meeting minutes of Members’ Council of limited liability companies with two or more members (Article 60)
  • Amendment of regulations on rights and obligations of company members (Articles 49, 50)
  • Modifying conditions for the resolution of the General Meeting of Shareholders to be passed (Clause 1 and 2, Article 148)
  • Amendment of regulations on meeting minutes of the Board of Directors (Clause 2, Article 158)

In addition, Law 03/2022/QH15 also amends some other laws as the Law on Public Investment, the Law on Housing, the Law on Bidding, the Law on Electricity, the Law on Enterprises, the Law on Special Consumption Tax, and the Law on Civil Judgment Execution.

Law 03/2022/QH15 took effect from 1 March 2022.

Promulgation of rules of origins in the RCEP Agreement

On 18 February 2022, the Ministry of Industry and Trade promulgated Circular 05/2022/TT-BCT on the Rules of Origin in the Regional Comprehensive Economic Partnership Agreement (RCEP).

Certification and verification of the origin of goods in Vietnam

According to this Circular, Appendixes on certification and inspection of commodity origin in Vietnam include:

  • Appendix I: Specific commodity-specific rules
  • Appendix II: List of mandatory information of goods origin documents
  • Appendix III: C/O form RCEP and forms of Supplementary C/O Declaration
  • Appendix IV: List of commodities applying tariff differentials

The list of agencies and organisations that issue C/O form RCEP of Vietnam is published on https://ecosys.gov.vn/.

The issuing agencies and organisations are required to register their seals and signatures and update them following the guidance of the Ministry of Industry and Trade.

General provisions on certification of origin

Article 19 of Circular 05/2022/TT-BCT stipulates the mechanism for certification of origin of goods under the RCEP Agreement as follows:

  • A Vietnam-origin good exported to a party will be considered for preferential tariff treatment in the framework of the RCEP Agreement if it is supported by a C/O issued under this Circular
  • Vietnam will grant preferential tariff treatment in the framework of the RCEP Agreement to an originating good imported from a party based on a proof of origin which may be:
    • A C/O issued by a C/O issuing body under Articles 21 and 22 of this Circular
    • A declaration of origin by an approved exporter under Articles 20 and 22 of this Circular
  • The Declaration of Origin specified in Point b Clause 2 of this Article will:
    • Be in writing, or any other medium, including electronic format
    • Contain information that meets the minimum information requirements as set out in Annex II enclosed herewith
    • Remain valid for one year from the issuing date
    • Be in the English language, and bear the name and signature of the certifying person and the issuing date

Claim for preferential tariff treatment

The Circular also regulates the submission of proof of origin of goods to enjoy tariff preferences as follows:

  • The importer will submit a valid proof of origin to the customs authority of the importing party to claim preferential tariff treatment.
  • The proof of origin may not be required if the customs value of the good imported from the exporting party does not exceed either USD200 or the equivalent amount in the importing party’s currency or any higher amount as the importing party may establish. Also, such importation is required not to form part of a series of importations carried out or planned to evade compliance with the requirement that a proof of origin must be submitted to customs authorities.
  • If the good has been transported through one or more parties other than the exporting party and the importing party as prescribed in Point b Clause 1 Article 18 of this Circular, the customs authority may require the importer to submit supporting evidence as prescribed in Clause 3 Article 18 of this Circular.
  • Where a proof of origin is submitted to the customs authority after the submission deadline, such proof of origin could be accepted if its failure to submit results from force majeure or other valid causes beyond the control of the importer or exporter.

Circular 05/2022/TT-BCT comes into force from 4 April 2022.

E-invoices to be mandatory from April 2022

According to the Decision, the use of e-invoices is compulsory for enterprises, economic organisations, household businesses, and individuals in 57 provinces and central-affiliated cities from April 2022.

The list of provinces and central-affiliated cities for implementing e-invoices is in the Appendix issued with Decision 206. Previously, the use of e-invoices was compulsory in 6 provinces and cities including Hanoi, Ho Chi Minh City, Hai Phong, Phu Tho, Quang Ninh, and Binh Dinh since November 2021.

Compulsory use of e-invoices in 57 provinces and cities will comply with regulations on e-invoices in the Law on Taxation Administration, Decree 123/2020/ND-CP, and Circular 78/2021/TT-BTC.

The Taxation Departments of 57 provinces and cities will:

  • Propose establishment of Steering Committees for mandatory use of e-invoices in their area to the Provincial People’s Committees
  • Organise training for taxpayers and tax officials in e-invoices to ensure effective use of e-invoices
  • Establish Operation Centres and publicise hotlines of the Provincial Taxation Departments and District-level Taxation Departments for assisting taxpayers in using e-invoice; etc.

Stopping supporting union members and employees affected by COVID-19 by the union from 1 March 2022

This is the content of Decision 4292/QD-TLD on stopping the implementation of Decision 3749/QD-TLD on support for union members and employees affected by the COVID-19 epidemic.

Accordingly, the Presidium of the Vietnam General Confederation of Labour decided to stop implementing Decision 3749/QD-TLD dated 15 December 2021 on support for union members and employees affected by the COVID-19 epidemic from 1 March 2022.

The receipt of dossiers of settlement of support payments for subjects infected with COVID-19 before 1 March 2022 according to Decision 3749/QD-TLD will be done until 31 March 2022 at the latest.

From 1 March 2022, support payments for union members and employees affected by the COVID-19 epidemic (including F0 deaths) will be made according to regulations on expenses for support, visits, and subsidies in Decision 4290/QD-TLD regulating revenue, expenditure, financial management, and assets of grassroots trade unions; and Decision 4291/QD-TLD regulating on standards and norms of spending regimes in trade unions.

Decision 4292/QD-TLD took effect from 1 March 2022.

 

For more information on tax updates and other compliance requirements for businesses operating in Vietnam, follow our monthly releases on the website and social media channels at vietnam.acclime.com.

Last updated on March 15, 2022
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