New Policies on Tax and Salary Effective from September 1

I. Amendment to Several Regulations on Export and Import Taxes:

2016 Export (XK) and Import (NK) Tax Law took effect from September 1, 2016. Notably, it includes some of the following provisions:

1. Separation of tax calculation bases by different methods:

This is a new point mentioned in the 2016 Export and Import Tax Law. Specifically:

- Tax calculation by percentage rate: The export and import tax amount is determined based on the taxable value and the tax rate percentage of each item at the time of tax calculation;

The export tax rate is specifically set for each item in the export tax schedule.

The import tax rate includes preferential rates, special preferential rates, and general rates.- Absolute tax calculation: The tax amount applying the absolute tax calculation method for exported and imported goods is determined based on the actual quantity of exported and imported goods and the absolute tax rate prescribed per unit of goods at the time of tax calculation;- Mixed tax calculation: The tax amount applying the mixed tax calculation method for exported and imported goods is determined as the total tax amount by percentage rate and the absolute tax amount;- Import tax for goods under tariff quotas is specifically stipulated in Article 7 of the 2016 Export and Import Tax Law.

1. Addition of new tax exemption cases:

2016 Export and Import Tax Law adds new tax exemption cases, shifting from the subject of tax refund to tax exemption such as:

- Temporary import for re-export, temporary export for re-import goods are subject to tax exemption;- Exemption of import tax for raw materials, supplies, and components for the production of projects that are specially encouraged for investment;- Raw materials and supplies for export production shift from tax refund to tax exemption.

1. Addition of tax rate types:

The 2016 Export and Import Tax Law adds provisions on applying the tax rate for goods from non-tariff zones imported into the domestic market based on the principle that the goods meet which origin conditions, then apply the corresponding tax rate for that origin type.

To be specific: Preferential rates apply to imported goods originating from countries, groups of countries, or territories implementing most-favored-nation treatment in trade relations with Vietnam or goods from non-tariff zones imported into the domestic market meet the origin rules from countries, groups of countries, or territories implementing most-favored-nation treatment in trade relations with Vietnam.

1. Amendment to the export tax rate framework:

It does not prescribe an export tax rate framework for the list of export taxed item groups but instead specifies the minimum rate for some export taxed item groups.

2005 Export and Import Tax Law expired from September 1, 2016.

II. New Guidelines on Pension Adjustment Timing

This is detailed in Circular 23/2016/TT-BLDTBXH which takes effect from September 1, 2016, guiding the adjustment of pensions, social insurance benefits, and monthly allowances according to Decree 55/2016/ND-CP.

Increase pension and monthly benefits by 8% for the subjects specified in Clause 1, Article 1 of Circular 23. The adjustment timing is calculated from the month starting to receive the pension, monthly allowance.

Example:

Mr. A started receiving a pension from January 1, 2015, with a pension rate at January 2015 of 5,200,000 VND/month.

Mr. A's new pension rate after adjustment is:

5,200,000 VND/month x 1.08 = 5,616,000 VND/month

The time Mr. A enjoys the new pension rate is calculated from January 2015.

The adjustment timing for those with a pension under 2,000,000 VND/month is calculated from:

- January 2016 for those receiving a pension before January 1, 2016.- From the start time for those beginning to receive a pension from January 1, 2016, to December 31, 2016.

III. Circular 121/2016/TT-BTC stipulating the toll rates, policies, collection, remittance, management, and use of road use fees at the toll station at Km2123+250, National Highway 1, Soc Trang Province

IV. Circular 122/2016/TT-BTC stipulating the toll rates, policies, collection, remittance, management, and use of road use fees at the toll station at Km2171+200, National Highway 1, Bac Lieu Province

V. Circular 123/2016/TT-BTC stipulating the toll rates, policies, collection, remittance, management, and use of road use fees at Yen Lenh Bridge toll station, National Highway 38

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