Nội dung toàn văn Official Dispatch No. 1744/TCT-DTNN, on Taxes for foreign contractors
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MINISTRY
OF FINANCE |
SOCIALIST REPUBLIC OF VIET NAM |
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No. 1744/TCT-DTNN |
Ha Noi, May 18, 2006 |
To: Cua Dat Hydro-Electricity Joint Stock Company
In response to Cua Dat Hydro-Electricity Joint Stock Company’s Official Letter No. 392CV/CD-TCKT dated April 10, 2006, on taxes for foreign contractors, the General Department of Taxation hereby gives the following opinions:
Foreign contractors who sign contracts with Vietnamese companies, do not operate under the Law on Foreign Investment in Vietnam, and do not adopt the Vietnamese accounting regime shall pay value-added tax and business income tax under the provisions of Section II, Part B and Section II, Part C of the Finance Ministry’s Circular No. 5/2005/TT-BTC of January 11, 2005.
For contracts on supply of machinery and equipment in association with installation instruction, training and trial operation services in which the value of services is separated, the application of the value added tax and business income tax rates for determining the value added tax and business income tax to be paid shall be based on each business activity’s turnover liable to value added tax and business income tax. In case it is impossible to separate the value of machinery and equipment from that of services, the business income tax rate of 2% and the value added tax rate applicable to the business line subject to the highest value added tax rate shall be applied to the whole contractual value.
The General Department of Taxation informs the company thereof for compliance.
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FOR
THE GENERAL DIRECTOR |
