Vietnam to Cut 3 per cent Incorporate Income Tax from 2009

4:23:11 PM | 6/4/2008

Vietnam will officially cut the corporate income tax (CIT) by 3 per cent to 25 per cent from 2009 in order to promote investment and production, the Thoi Bao Sai Gon newspaper said on June 3.

The tax reduction will be made after the National Assembly endorsed the amended Law on Corporate Income Tax on June 2.

CIT, which will be adjusted to 25 per cent from current 28 per cent, may reduce the State budget about VND5 trillion a year, but it will offset the coffer with the increasing investment in long term.

The new amended law allows businesses not to pay for advertisement, marketing, promotion and some other spending more than 10 per cent of total expenditures reasonable for taxation.

Lawmakers said that the reduction of corporate income tax will create favorable business and investment environment, help companies improve financial accumulation and capability and competitiveness.

Vietnam has last cut the CIT from 32 per cent to 28 per cent in 2003. (Saigon Economic Times)