Overview of Vietnam taxation system

With Vietnam taxation system, tax administration is regulated the Law on Tax Administration enacted in 2007, and overseen by the National Department of Taxation, which operates under the Ministry of Finance. Tax affairs are more commonly handled by local provincial (municipality) tax departments and district tax departments. All foreign-invested companies are supervise by provincial tax departments (not district departments).

Every corporate business should be subject to or deal with the following common taxes:Value Added Tax (VAT), Corporate Income Tax (CIT), Foreign Contractor Tax (FCT), and Personal Income Tax (PIT). Other less common taxes are Special Sales Tax, Environmental Tax, Import and Export Duties, Natural Resources Tax, Environmental Tax, Property Tax, etc.. The working mechanism of these taxes is described in great detail, and is governed by each respective tax law and/or set of regulations (decrees and circulars).

Despite all the reforms and progress, taxation is still one of the most challenging areas facing people doing business in Vietnam, both foreign and local. A business in Vietnam spends  168 hours in average a year just to pay taxes. “Paying taxes” rankes 168/198 countries surveyed by World Bank in 2016.

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Vietnam taxation system