Vietnam will increase taxes for Samsung and other multinational corporations to 15% starting from January, as part of global tax reforms.
This decision by the National Assembly has been delayed, although new incentives for high-tech investors are expected in the later stage. The delay raises concerns about foreign investment in the future. The new tax regime will be effective from January 1, 2024.
The National Assembly does not provide a separate resolution on investment incentives at this time. Corporate tax in Vietnam has been 20%, but for many years, the country has applied a much lower effective tax rate for large foreign investors. With the new tax rate, 122 foreign companies will face a sudden increase in their tax costs, estimating additional income for the country at VND 14.6 trillion ($601 million) per year.
Samsung is expected to bear a significant portion of this tax. Revenue from Samsung’s factories in Vietnam is the largest in the country. The company only paid 5.1% tax in a Vietnamese province where it operated in 2019.
- Recap: As of January 1, 2024, the global minimum tax policy initiated by the Organization for Economic Cooperation and Development (OECD) takes effect.
- To date, all 142 member countries, including Vietnam, unanimously agree to this tax policy. Large corporations with a consolidated global revenue of €750 million or more are required to pay a minimum tax of 15%.
Source: Báo tuổi trẻ
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