Estimated revenue of tens of thousands of billions of dong from global minimum tax

The application of additional corporate income tax under the provisions on preventing global tax base erosion was officially approved at the 8th session of the 15th National Assembly. The Ministry of Finance is urgently developing a detailed decree.

Estimated revenue of tens of thousands of billions of dong from global minimum tax

The application of additional corporate income tax under the provisions on preventing global tax base erosion was officially approved at the 8th session of the 15th National Assembly. The Ministry of Finance is urgently developing a detailed decree.

Estimated revenue of tens of thousands of billions of dong

This morning, VCCI and the Ministry of Finance jointly organized a dialogue conference on tax and customs policies and administrative procedures in 2024. Resolution No. 107/2023/QH15 dated November 29, 2023 on the application of additional corporate income tax under the regulations on preventing global tax base erosion is one of the new contents on tax policies and administrative procedures worth noting in 2024.

The Resolution on the application of additional corporate income tax under the provisions against global tax base erosion includes 8 Articles and 1 Appendix. Notably, the Resolution stipulates that the taxpayer is a constituent unit of a multinational corporation with revenue in the consolidated financial statements of the ultimate parent company for at least two years in the 4 consecutive years preceding the fiscal year equivalent to 750 million euros (EUR) or more, except for some cases as prescribed.

The Resolution stipulates two contents on the application of additional corporate income tax. In particular, the additional domestic minimum standard tax (QDMTT) applies to the constituent units or groups of constituent units of the above-mentioned multinational corporations, with production and business activities in Vietnam during the fiscal year.

The Minimum Income Tax Rules (IIR) apply to the ultimate parent company, partially owned parent company, intermediate parent company in Vietnam which is a constituent unit of the above-mentioned multinational corporation, directly or indirectly holding ownership of a low-tax constituent unit abroad under the Global Minimum Tax Rules at any time during the fiscal year.

The minimum tax rate stipulated in the Resolution is 15%. According to information at the Conference, based on the 2022 corporate income tax settlement data, the General Department of Taxation has preliminarily calculated that there are about 122 foreign corporations investing in Vietnam affected by the Standard Domestic Minimum Supplement Regulation (QDMTT). The estimated additional tax collected from this group is about VND 14,600 billion.

Also according to preliminary calculations based on 2022 corporate income tax settlement data, if Vietnam applies the minimum aggregate taxable income (IIR) regulation, there will be 6 Vietnamese corporations subject to the application. The additional corporate income tax that Vietnam can collect is expected to be about 73 billion VND (in case the investment recipient countries do not apply the IIR).

Urgently developing a detailed Decree

According to the provisions of the Resolution, taxpayers must declare information declarations according to the Global Minimum Tax Regulations, supplementary corporate income tax declarations with explanatory notes explaining the differences due to differences between financial accounting standards.

Regarding the deadline for filing and paying taxes, the regulation on the standard minimum supplementary domestic corporate income tax (QDMTT) is 12 months after the end of the fiscal year. As for the regulation on the aggregate minimum taxable income (IIR), it is 18 months after the end of the fiscal year for the first year the group is subject to the application; and 15 months after the end of the fiscal year for the following years.

Currently, the Ministry of Finance (General Department of Taxation) is urgently developing a Decree detailing the contents assigned in the Resolution to ensure full legal basis, consistency and consistency with the provisions of the Resolution for implementation and the Ministry of Finance has issued Official Dispatch No. 12367/BTC-TCT dated November 12, 2024 on soliciting opinions on the draft Decree detailing Resolution No. 107/2023/QH15 dated November 29, 2023.

Source: https://baodautu.vn/uoc-thu-hang-chuc-nghin-ty-dong-tu-thue-toi-thieu-toan-cau-d232076.html