NA permits 30pct corporate income tax cut in 2012

Late 21 June, National Assembly passed a resolution to promulgate several tax policies in an attempt to ease difficulties for both individuals and businesses.

Accordingly, NA gave green light to 30 percent reduction in receivable corporate tax amounts for 2012 for all small and medium sized enterprises (excluding those trading in lottery, real estate, securities, finance, banking, insurance, special consumption tax-levied goods and services), labour-intensive industries manufacturing and processing agricultural, fishery and forestry products, garment and textile, footwear, electronic components and socioeconomic infrastructure construction projects.

Also, exemption of lump-sum tax including value added tax (VAT), individual income tax and corporate tax is applicable to individuals and households trading guest-houses and rooms for renting to labourers, students and pupils; providing childcare and meals for shift workers provided that the prices and charges remain unchanged as in late last year.

In addition, individuals with income from salaries and businesses taxable under grade 1 in the partially progressive tariff would benefit from person income tax exemption from 1 July 2012 till 31 December 2012.

Regarding the proposal to slash VAT by 50pct, the National Assembly Standing Committee finally came to decision that such measure would not be included in the Resolution citing doubts about subsequent reduction of commodity selling prices, without which demand could hardly be boosted. Furthermore, the state budget is likely to suffer then and barely have any measures been available to cover such loss as yet.

 

 

Category: Legal