Vietnam Considers Multi-Million Dollar Incentives for Samsung and Other Companies to Offset Global Tax Concerns
Samsung and other foreign companies have requested Vietnam to introduce a multi-million-dollar reform that would compensate them for higher levies they face from next year under a global overhaul of tax rules, according to a source involved in the talks.
Vietnam has committed to comply with the OECD rule, which requires companies paying less in a low-tax jurisdiction to face a top-up levy in their home country. A top-up levy means foreign companies could pull out precious foreign exchange from Vietnam to comply with the rule, and Hanoi’s decision to implement the higher 15% tax rate and plans for compensation are aimed at preventing this from happening.
The government is preparing a draft resolution that could be approved by the Parliament in October offering partial compensations to big firms, the source said. The total cost of the planned measure is estimated at several hundreds of millions of dollars a year.