On February 24^th 2020, Vietnamese Government enacted Decree 22/2020/ND-CP on Amendments to Government’s Decree 139/2016/ND-CP dated October 04^th 2016 on license fee with some new noticeable following points:

Enterprises could be exempted from license fee as following cases:

“Exemption of license fees for the first year from the date of establishment or official commencement of production/business (from January 01^st to December 31^st).”

“Small- and medium-sized enterprises (SMEs) transformed from household businesses (as prescribed in Article 16 of the Law on assistance for small- and medium-sized enterprises) shall be exempted from the license fee within 03 years from the date of issuance of initial enterprise registration certificate.”

In addition, Public general education schools and public pre-schools are also new cases of exemption of license fee.

No need to pay license fee for the year of production/business suspension when already sent notification of production/business suspension and has not yet paid license fee for the planned year of suspension as follow:

“An operating payer of the license fee that has notified its supervisory tax authority in writing of its suspension of production/business in a calendar year must not pay the license fee for that year of production/business suspension if it has sent a written notification of production/business suspension to its supervisory tax authority before the prescribed deadline for paying the license fee (January 30 annually) and has made no payment of the license fee for the planned year of suspension.”

The declaration of license fee is adjusted: deadline for declaration is January 30^th of the following year of commencement of production/business or the year of establishment and household businesses, individuals, groups of individuals paying fixed tax do not submit declarations of license fee.

“Payers of the license fee that have just started their production/business or established their business facilities and SMEs transformed from household businesses shall make and submit their declarations of license fee to their supervisory tax authorities by January 30 of the year following the year of commencement of production/business or the year of establishment.”

“Household businesses, individuals and groups of individuals paying fixed tax must not submit declarations of license fee. Based on received tax declarations and tax database, tax authorities shall determine revenues which are then used as the basis for determining the license fee amounts payable by household businesses, individuals and groups of individuals paying fixed tax.”

The new Decree came into force on February 25th 2020 encourages enterprises to operate business activities in Vietnam.

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Due to the damages of Coronavirus on the domestic economy, the Decree 41/2020/ND-CP was issued on tax and land rent deferral to assist affected enterprises during difficulty period on 8 April 2020. It came into force from the date of signing.

Applicable entities including to enterprises, organizations, households, and individuals operating in agro-forestry-fishery sector; food processing and manufacturing, garment and textile; straw and plastic products; metallurgy, mechanical engineering; and construction; producing auxiliary and key mechanical products and micro and small-sized enterprises, credit organizations, branches of foreign banks which support their COVID-19 affected customers.

Deferred period for taxes and land rental are specified as follow:

Value Added Tax (VAT) obligation for the period from March to June 2020 or Quarter I and II/2020 shall be extended to 05 months which indicates the payment of VAT of first quarter of 2020 would be extended to September while second quarter to December 2020.

Corporate income tax, extension would be given to the remaining sums of 2019, provisional tax of the assessment period of the first and the second quarter.

Household and individual businesses, the deadlines for paying value added tax and corporate income tax was extended to December 31.

Payment of land use fees would also extended five months from May 31.

Deferral application procedures:

A taxpayer eligible for tax deferral shall submit an application for tax and land rent deferral (electronically or other method) to the supervisory tax authority. The deadline for sending an application for tax and land rent deferral is 30 July 2020.

Taxpayers will be responsible for self-determination of their eligibility for deferral request as prescribed in this Decree. The tax authority shall not inform the taxpayer whether the application is accepted or not.

In the case of the tax authority uncovers that the taxpayer is not eligible for deferral, the taxpayer must fully pay the outstanding tax, penalty (if any) and late payment interest determined by the tax authority to the State Treasury.

This regulation aim to support domestic enterprises dealing with difficulties from the outbreak of Coronavirus.

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What is e-Visa? This is an electronic travel authorization from the Vietnam Government for up to 30 consecutive days, issued in PDF format. It is the equivalent to a visa, but no stamp or label is placed in the passport.

Who can get e-Visa? According to the Resolution 79/NQ-CP, from July 1^st 2020, all foreigners who want to enter Vietnam from 80 countries (including United States, United Kingdom of Great Britain and Northern Ireland, China, France… *check the full list below) can get the e-Visa through Immigration Department Web portal.

The condition of getting e-Visa? Outside Vietnam Foreigners, have a valid passport (at least 6 months) and NOT in the prohibited list.

What should be noted about e-Visa?

This is a single entry visa, valid for 30 days, from the proposed date of entry indicated during the application.

Once the first 30 days have passed, and renewal be needed it, e-Visa holders in Vietnam may be considered to grant new visa IF being invited/guaranteed by authority/organisation/individual in Vietnam in accordance with Law on foreigners' entry into, exit from, transit through, residence in Vietnam.

Minors with their own passport must complete a full e-Visa application. Minors aged 14 and under included on their parent’s passport will have to be included on their parents e-Visa application.

Applicants can entry-exit in designated ports for e-Visa only (*check the full list below) and are required to carry a copy of their e-Visa at all times during their stay.

The fee is 25 USD and will not be refund in case of applicants could not get e-Visa. 

How to get e-Visa?

Step 1: Access to website https://www.xuatnhapcanh.gov.vn select 'e-Visa' section, find yourself in 'selections' and complete all blank information. Your application will be processed in 3 working days. Example:

Step 2: Pay e-Visa fee.

Step 3: Get the e-Visa.

*List of 80 allowed countries:

Andorra, Argentina, Armenia, Australia, Austria, Azerbaijan, Belarus, Belgium, Bosnia and Herzegovina, Brazil, Brunei, Bulgaria, Canada, Chile, China (including Hong Kong SAR, Macau SAR / Not apply to Chinese e-passport holders), Colombia, Croatia, Cuba, Cyprus, Czech Republic, Denmark, Estonia, Fiji, Finland, France, Georgia, Germany, Greece, Hungary, Iceland, India, Ireland, Italy, Japan, Kazakhstan, Korea (South), Latvia, Liechtenstein, Lithuania, Luxembourg, The former Yugoslav of Macedonia, Malta, Marshall Islands, Mexico, Federated States of Micronesia, Moldova, Monaco, Mongolia, Montenegro, Myanmar, Nauru, Netherland, New Zealand, Norway, Palau, Panama, Papua New Guinea, Peru, Philippines, Poland, Portugal, Qatar, Romania, Russia, Samoa, San Marino, Serbia, Slovakia, Slovenia, Solomon Islands, Spain, Sweden, Switzerland, Timor Leste, United Arab Emirates, United Kingdom of Great Britain and Northern Ireland, United States of America, Uruguay, Vanuatu, Venezuela.

*List of allowed ports to entry and exit:

Airport: Cat Bi International Airport (Int Airport), Cam Ranh Int Airport, Can Tho Int Airport, Da Nang Int Airport, Noi Bai Int Airport, Phu Bai Int Airport, Phu Quoc Int Airport, Tan Son Nhat Int Airport.

Landport: Bo Y, Cha Lo, Cau Treo, Huu Nghi, Ha Tien, Lao Bao, Lao Cai, Moc Bai, Mong Cai, Nam Can, Song Tien, Tinh Bien, Xa Mat.

Seaport: Da Nang, Hon Gai, Hai Phong, Nha Trang, Quy Nhon, Ho Chi Minh City, Vung Tau.

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On June 8^th 2020, Socialist Republic of Vietnam officially ratified the EU-Vietnam Free Trade Agreement (EVFTA) with 100% approval of Vietnamese National Assembly and will soon go into effect in July 2020 tentatively.

EVFTA marked a turning-point in the EU’s longer-term goal of co-operation between EU and Vietnam trade deal. The agreement includes 17 chapters, two protocols and several attached memorandums, with main contents covering the following aspects: trade in goods; services, investment liberalization, e-commerce; Government procurement and Intellectual property right. The key aspect is the dismantling of customs barriers and the facilitation of European-Vietnamese trade relations which will eliminate 99 percent of tariffs on trading-goods from two sides. In the details:

The European Union (EU) will remove approximately 85.6% of tariff lines, equivalent to 70.3% of export turnover of Vietnam to EU; abolish import duties on 99.2% of tariff lines, equivalent to 99.7% of export turnover of Vietnam after 7 years from the entry into force. For about 0.3% remaining exports, the EU pledged to provide Vietnam with tariff quotas in the quota import tax to 0%

Vietnam has also committed eliminate 48.5% of tariff lines, equivalent to 64.5% of EU imports immediately after the agreement comes into force , after seven years, 91.8% of the tariff lines, equivalent to 97.1% of EU export revenue, will be removed and after 10 years is about 99% of tariff lines, equivalent to 99.8% of EU imports.

The Agreement will bring advantages to both European and Vietnamese enterprises immediately after coming into effect: Vietnam will cutting 65% of import tax on EU commodities and the EU will cut more than 70% of tariffs on Viet Nam’s commodities. The rest will be erased over a 10-year period and 7-year period respectively.

EVFTA will create abundant chances for Vietnamese development and be a leap to the economics and co-operation of Vietnam – EU.

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From July 1^st, 2019, Clause 8 of Article 4 in Resolution 70/2018/QH14 on State budget estimate for 2019 stipulates the adjustment of the basic monthly salary from 1.39 million VND to 1.49 million VND. Therefore, social insurance allowances will also increase accordingly. Here are 7 social insurance allowances that significantly increase in 2019, employees should seize to relish their rights.

1. The wage ceiling to pay social insurance

The wage ceiling to pay social insurance in accordance with the current law is equal to 20 times the minimum salary. When the Law on Social insurance 2006 came into effect from January 1, 2007, to the end of 2015 and the new Law No. 58/2014/QH13 on Social insurance became effective since January 01, 2016 to present, there have been 8 times of the salary increase, dragging the increase of the wage ceiling to pay social insurance.

From July 01, 2019, the basic monthly salary will be 1.49 million VND per month. As a result, the wage ceiling to pay social insurance will be 29.8 million VND per month instead of 27.8 million VND (because the previous basic monthly salary was 1.39 million VND).

Legal basis: Article 89, Law on Social insurance.

2. The allowance for convalescence and health rehabilitation after sickness

An employee who has taken leave under the sickness regime for the full number of days in a year prescribed in Article 26 of Law on Social insurance, but whose health has not yet recovered within 30 days after return to work, is entitled to a leave of between 5 days and 10 days in a year for convalescence and health rehabilitation. The allowance for convalescence and health rehabilitation after sickness must equal 30% of the basic salary.

Since, from July 1^st, 2019, the allowance for convalescence and health rehabilitation after sickness will be adjusted from 417.000 VND per day to 447.000 VND per day.

Legal basis: Article 29, Law on Social insurance.

3. Lump-sum allowance upon childbirth

Female employees giving birth are entitled to a lump-sum allowance equaling 2 times the basic salary for each child in the month of childbirth. In case the mother gives birth to a child but only the father is covered by social insurance, the father is entitled to a lump-sum allowance equaling 2 times the basic salary for each child in the month of childbirth.

From July 1^st, 2019, the lump-sum allowance upon childbirth will be 2.98 million VND (the previous allowance was 2.78 million VND).

Legal basis: Article 38, Law on Social insurance.

4. Convalescence and health rehabilitation after the maternity leave period

Female employees whose health has not yet recovered within the first 30 working days after the maternity leave period, are entitled to a leave for convalescence and health rehabilitation of between 5 and 10 days. The allowance for convalescence and health rehabilitation after the maternity leave period must equal 30% of the basic salary.

In detail, the convalescence and health rehabilitation after the maternity leave period from July 1^st, 2019 will be 447.000 VND per day, higher than before 30.000 VND per day.

Legal basis: Article 41, Law on Social insurance.

5. Minimum monthly pension

The lowest monthly pension of employees covered by compulsory social insurance who fully satisfy the conditions for pension enjoyment must equal the basic salary (except for exceptional cases).

Consequently, from July 1^st, 2019, the minimum monthly pension of employees will be 1.49 million VND.

Legal basis: Article 56, Law on Social insurance.

6. Funeral allowance

When the following persons die, the persons who take charge of their funeral are entitled to a lump-sum funeral allowance:

Employees who are paying social insurance premiums or employees who have their period of social insurance premium payment reserved and have paid social insurance premium payment for at least full 12 months; employees who die of a labor accident or an occupational disease; persons who are on pension or monthly labor accident or occupational disease allowance and have ceased working…

The funeral allowance must equal 10 times the basic salary of the month when the above-mentioned persons die. From July 1^st, 2019, the funeral allowance will be 14.9 million VND.

Legal basis: Article 66, Law on Social insurance.

7. Levels of monthly survivorship allowance

When the following persons die, their relatives are entitled to a monthly survivorship allowance:

Employees who have paid social insurance premiums for at least full 15 years but have not yet received a lump-sum social insurance allowance; employees who are on pension; employees who die of a labor accident or an occupational disease; employees who are on monthly labor accident or occupational disease allowance for their working capacity decrease of 61% or more.

The monthly survivorship allowance for each relative must equal 50% of the basic salary or 70% of the basic salary for relatives who have no direct fosterer.

From July 1st, 2019, the monthly survivorship allowance for each relative will increase from 695.000 VND to 745.000 VND per month; the monthly survivorship allowance for relatives who have no direct fosterer will increase from 973.000 VND to 1.043 million VND per person per month.

Legal basis: Article 68, Law on Social insurance.

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Enterprises providing labor outsourcing services are established and operated under regulations of law with the function of hiring laborers under labor contracts. These enterprises do not directly employ laborers but provide to other individuals and organizations in the form of temporary work.

The purpose of outsourcing service is to temporarily satisfy to the sudden increase in labor demand during a certain period of time; to replace the employees during maternity leave, labor accident, occupational disease or having to fulfill civic obligations; or to satisfy the needs to use high-skilled employees.

Science and Technology businesses are not only a bridge to rapidly put scientific and technological research and application into production but also a key in productive forces creating value-added products, contributing to the construction and development of the country’s economy and GDP.

Draft Law on Enterprise amendments will focus on simplifying market entry procedures, reducing corporate restructuring costs, improving corporate governance...

In order to support and create conditions for business households to transform their operations into enterprises models, promote small and medium-sized enterprises to develop, the draft of National Assembly’ Resolution reduces corporate income tax to 15-17%.

The National Assembly has passed the Resolution on on ratifying the CPTPP Agreement and related documents on November 12^th, 2018. Accordingly, the Agreement has come into force for Vietnam since January 14^th, 2019. Previously, the CPTPP Agreement has officially taken effect since December 30^th, 2018 as for the first six countries to complete the ratification of the Agreement, including Mexico, Japan, Singapore, New Zealand, Canada and Australia.

CPTPP is one of the biggest trade agreements in the world. The countries included in the Agreement: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. 11 CPTPP members countries with 499 million people and gross domestic product (GDP) of more than 10,000 billion USD, accounting for over 13% of the global GDP. This Asia's latest multilateral trade agreement eliminates not only tariffs on goods but also barriers to investment, services and data, opening up opportunities in retail, banking and electronic commerce.

Vietnam commits to eliminate nearly 100% of tariffs, therein, 65.8% of which will become 0% as soon as CPTPP takes effect; 85.5% to 0% in the 4^th year; 97.8% to 0% in 11^th year; The remaining goods (considered sensitive) are committed to abolish import tax with a maximum schedule of 16 years, or under tariff quotas. Specifically, as for industrial goods such as automobiles, tax will be eliminated in the 13^th year for new cars and to 0% after 16 years; iron, steel and petroleum will be mostly eliminated in the 11^th year; plastic and plastic products in the 4^th year; textile and footwear eliminated immediately when CPTPP is effective ... As for agricultural and aquatic products, Vietnam commits to eliminate tax on chicken in the 11^th year; fresh pork in the 10^th year and frozen meat in the 8^th year; rice eliminated immediately when CPTPP takes effect; corn in the 5^th year; Meat-processed foods eliminated in the 8^th year to the 11^th year; seafood processing in the 5^th year ...

Vietnam will amend a number of laws and decrees in the process of reviewing the law to comply with the regulations of CPTPP, applying directly many commitments, especially in the field of service and investment opening. System reform helps improving the business environment, maintaining and growing foreign and domestic investment, focusing on exports to take advantage of the CPTPP market, raising the competitive capacity of Vietnamese goods. New customs regulations under CPTPP will make cross-border trade flows smooth. Member countries need to ensure that goods can be delivered within 48 hours after arriving at the airport. Visa issuance will also become faster. Some member countries will grant visas quickly for family members traveling with entrepreneurs. CPTPP also restricts countries managing to keep domestic customer data on servers located in their territory. Companies operating in commercial bloc can run businesses based on data, using servers in their country or in a third country, thereby reducing initial investments to penetrating a new market.

According to the World Bank's calculations, direct benefits that CPTPP brings to Vietnam help GDP increasing by 1.1% in 2030, and indirectly by 3.6%. In addition, CPTPP also brings benefits from non-tariff barriers.

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Asia Business Consulting is a boutique consulting firm specializing in corporate establishment, legal and business advisory, tax and payroll compliance, HR administration, market research to multinationals investing in Vietnam. For further information or to contact the firm, please email This email address is being protected from spambots. You need JavaScript enabled to view it. or download the company brochure. You can stay up to date with the latest business and investment news in Vietnam by subscribing for our newsletters.