New policies take effect from January 2016

Guidelines for the implementation of the law on special excise duty

According to Circular 195/2015/TT-BTC of the Ministry of Finance guiding the Government’s Decree no. 108/2015/NĐ-CP dated December 28^th, 2015 on guidelines for some article of the law on special excise duty and the law on amendments to the law on special excise duty, many cases shall be applied with tax refund, tax deduction, tax reduction on special excise duty.

Increase the rates of special excise tax on cigarettes, alcohol, and beer.

According to Law on amendments to some articles of the law on special excise duty, the rate of special excise tax on cigarettes, cigars and other products derived from tobacco plants increased from 65% to 70% from January 1^st, 2016 and to 75% from January 1^st, 2019; the rate of special excise tax on alcohol with ABV < 20^o is 30% from January 1^st, 2016 and 35% from January 1^st, 2018.

The rate of special excise tax on alcohol with ABV ≥ 20^o is increased by 5% to 55% from January 1^st 2016, to 60% from January 1^st 2018, and to 65% from January 1^st 2018.

Supplementing cases not subjected to value-added tax declaration and assessment

Ministry of Finance issued Circular 193/2015/TT-BTC amending and supplementing the Circular no. 219/2013/TT-BTC of the Ministry of Finance dated December 31, 2013 on provision of guidance on implementation of the value-added tax law.

Thus, apart from manufacturing organizations which are not subjected to value-added tax declaration and assessment as described in Clause 7 Article 5 Circular 219/2013/TT-BTC, Circular 193/2015/TT-BTC supplements the following cases:

– Organizations or enterprises paid remunerations by government bodies for their provision of authorized collection or payment services.

– Such authorized collection and payment remunerations which are not subject to value-added tax declaration and assessment as prescribed in this point are those obtained from activities:

– Collection of voluntary social insurance, voluntary health insurance premiums authorized by social insurance authorities;

– Payment of benefits provided as an advantage for persons honored for their meritorious service, other benefits authorized by the Ministry of Labor, War Invalids and Social Affairs;

– Collection of taxes paid by sole proprietors authorized by tax authorities and other collection and payment activities authorized by government bodies.

Circular 193/2015/TT-BTC takes effect from January 10th, 2016.

Incentives for supporting industries

Decree No. 111/2015/NĐ-CP dated November 3^rd 2016 of the Government on development of support industries takes effect from January 1^st 2016 with various incentives to supporting industries. Ranges of incentives vary from Research and Development, application, technology tranfer, and manufacturing.

The Government also attached the Decree with the prioritized supporting products list, including 6 product groups: garment, shoes, electronics, automobile assembling and manufacturing, machenic, high technology.

Establishment, management and use of housing and real estate market information system

Decree no. 117/2015/NĐ-CO dated November 12^th 2015 of the Government on establishment, management and use of housing and real estate market information system aims at establishing, managing and using of house and real estate market information system, reliability for management activities, commands, market administrations and social development demands; matches with practive requirements and relating regulations; implementation of Law on housing and Law on Real Estate Trading 2014, contributes to the finalization of legal framework in housing and real estate section, and is the base for the creation of legal corridor which can catch up with market development.

Region-based minimum wages increase from January 1^st 2016

Decree no. 122/2015/NĐ-CP dated November 14^th 2015 of the Government states that region-based minimum wages shall be applied from 2,400,000 to 3,500,000 VNĐ/month to employees working for companies, cooperative unions, cooperatives, cooperative groups, farms, households, individuals and organizations hiring employees under labor contracts according to regulations in the Labor Code.

Procedures on submiting wage scales, wage tables:

Ministry of Labor, War Invalids and Social Affairs issued procedures on labor, wages, and industrial relations attached with Decision no.1858/QĐ-LĐTBXH as follow:

– Order for procedure: “Submiting wage scales, wage tables, and determination of labor norms”:

Step 1: Employer formulates the wage scale, wage table for use as the basis to employ and use labor and concurrently send them to the district-level state management agency.

Step 2: District-level state management agency receives registered wage scale and wage table.

– Submitting measures: directly or via post.

– Documentation components: wage scales, wage tables, and determination of labor norms.

– Performer: Employer.

– Requirements, conditions: not against the law code.

Decision 1858/QĐ-LĐTBXH takes effect from December 21^th 2015

Penalties for violations in activities of multi-level marketing

Decree no.124/2015/NĐ-CP dated November 19^th 2015 on amendments and supplements to a number of articles of the Government’s Decree no. 185/2013/NĐ-CP dated November 15, 2013 regulating penalties for administrative violations in commercial activities, production and trading in counterfeit and banned goods, and protection of consumer rights takes effect from January 1^st 2016

Thus, the Decree provides provision on penalties for violations in activities of multi-level marketing. Specifically, a fine from VND 30,000,000 – 50,000,000 for multi-level marketing activities without registration with competent state agencies; a fine twice the level for violations as prescribed in Clauses 8, this Article for violations committed on administrative divisions from two central-affiliated cities and provinces and over.

Support for basic training courses and short-term training courses under 3 months.

Decision no. 46/2015/QDD-TTg dated September 28^th 2015 of the Government regulating policies on support for basic training courses and short-term training courses takes effect from January 1^st 2016. The Decision detailing provisions on: Rules for provision of support for basic training courses and short-term training courses, subsidies on training costs for basic training courses and short-term training courses under 3 months.

Detailing several provisons on the law on social insurance regarding compulsory social insurance

Decree no. 115/2015/NĐ-CP dated November 11^th 2015 of the Government detailing several provisons on the law on social insurance regarding compulsory social insurance takes effect from January 1^st 2016. The Decree details provisions on maternity benefit for female employees as surrogate mothers and intended mothers; retirement; survivorship; social insurance;

Pursuant to Law on social insurance no.58/2014/QH13, detailing in Decree no. 115/2015/NĐ-CP, from January 1^st 2016, the monthly salary as the basis for social insurance payment will be the salary plus salary-based allowance mentioned in the labor contract.

Specifically, from January 1^st 2016 to the end of 2017, social insurance payment bases on the salary plus salary-based allowance mentioned in the labor contract. The employees pay for 8% and the employers pay for 18%, which account for 26% of monthly salary.

New provisions on Circular 47/2015/TT-BLĐTBXH about labor

From January 1st 2016, Circular 47/2015/TT-BLĐTBXH on guidelines for labor contracts, labor discipline and material responsibility prescribed in Decree no. 05/2015/NĐ-CP dated January 12th, 2015 of the Government providing guidance on the labor code. Thus, there are some following new noticeable provisions:

1. Employees absent from work with plausible reasons

An employee absent from work with the following reasons shall be considered plausible reasons:

– A natural disaster or conflagration occurs that the employee is unable to present herself/himself at work regardless of every remedial measure adopted;

– Illness of the employee or his/her mother, father, adoptive mother, adoptive father, mother-in-law, father-in-law, husband, wife, natural child or lawfully adopted child, surrogacy child with certification by a health facility founded and operated as prescribed in law.

(An employee absent from work with plausible reasons shall not be applied with dismissal as described in Article 31 of Decree 05/2015/NĐ-CP.

2. Clause 1 Article 5 of Circular 23/2015/TT-BLĐTBXH is annulled, monthly wage is not required to be paid within the month. That monthly wage shall be paid once or twice a month and agreement on a fixed time of wage payment in the month remains effectively.
3. Amended and supplemented provision on actual hourly wage on a normal working day to calculate overtime payment; the actual wage shall not include overtime payment, extra pay for night work, bonus, food expenses between shifts, subsidies…
4. Daily wage is paid for one working day which equals to a monthly wage divided by number of working days in the under regulations of law as selected by the enterprise (provided that it does not exceed 26 days).
5. The salary as the basis for calculating the pay for an employee in work suspension time, annual leave, public holiday leave, paid leaves or salary advance prescribed in Article 26 of the Decree No.05/2015/ND-CPis the salary specified in the labor contract prescribed in Clause 1, Point a Clause 2 and Point a Clause 3 Article 4 of this Circular.
6. Besides, Circular 47/2015/TT-BLĐTBXH also provides guidance on authorization to conclude labor contracts, Labor contracts concluded with elderly employees…