Vietnam to set its corporate tax rate at 15% from Jan. 2024

Vietnam has passed a resolution to align its corporate tax rate with the global minimum levy of 15% on multinational companies.

Key Takeaways

• Vietnam has passed a resolution to align its corporate tax rate with the global minimum levy of 15% to prevent a race-to-the-bottom competition for attracting multinational companies.
• The new tax rule aims to bring Vietnam’s investment environment closer to international standards and will come into effect in January 2024.
• To offset the added tax burden, Vietnam is considering providing financial support to high-tech manufacturing and research and development activities through direct payments or tax deductions.

Currently, Vietnam taxes corporate income at 20%, but with tax holidays and rebates, the effective rate can be as low as 10% for large international firms. The new tax rule aims to bring Vietnam’s investment environment closer to…