Vietnamese government will submit its policy on global minimum tax to the National Assembly in October this year.
The government said it is looking to implement Qualified Domestic Minimum Top-up Tax (QDMTT) and income inclusion rules (IIR) in its domestic tax law starting January 2024.
A minimum global tax rate under the OECD’s Pillar two initiative is a significant and important change to the international tax scene. The Pillar Two rules, commonly known as GLoBE, ensure large multinational enterprise pay a minimum level of tax on the income arising in each of the jurisdictions where they operate.
More specifically, the tax rules provide for a coordinated system of taxation that imposes a top-up tax on profits arising in a jurisdiction whenever the effective tax rate, determined on a jurisdictional basis, is below the minimum rate set at 15 percent.
Chairing a government session on law-building on July 26, Prime Minister Pham Minh Chinh said the application of the global minimum tax is necessary to ensure Vietnam’s legitimate rights and interests.
According to the Vietnamese government, the global minimum tax would affect hundreds of multinational enterprises in Vietnam.