New policies coming into force in the beginning of April 2016

1. Time limit for issuance of work permit duration shortened

According to Decree No. 11/2016/NĐ-CP, the Department of Labor, War Invalids and Social Affairs shall issue a work permit to a foreign worker within 07 working days (formerly 10 days) from the day on which the satisfactory application is received.

If the application is rejected, a written response and explanation shall be provided.

The Decree comes into force from April 01, 2016.

2. Guidance on corporate income tax incentives

Circular No. 21/2016/TT-BTC, which comes into force from April 01, 2016, provides guidance on corporate income tax incentives for supporting industries as follows:

- Corporate income tax incentives are applied to income of any enterprise that executes a project for manufacture of supporting industry products from January 01, 2015, satisfy all conditions in the Law on amendments to tax laws 2014 and instructional documents are satisfied, and obtains a Certificate of incentives for manufacture of supporting industry products.

- Procedures for certifying incentives and post-incentive inspection of projects for manufacture of supporting industry products on the List of prioritized supporting industry products in Circular No. 55/2015/TT-BCT. />
- The Certificate of incentives for manufacture of supporting industry products is the basis for applying corporate income tax incentives.

- Incentive levels, time for applying incentives, and transition of incentives shall comply with regulations of law on corporate income tax.

- Where an enterprise engages in various business activities while receiving corporate income tax incentives, it shall separate income from the project for manufacture of supporting industry products which is eligible for corporate income tax incentives.

Corporate income tax incentives specified in Circular No. 21/2016/TT-BTC shall apply from the tax period 2015.

3. Amendments to concessional import tariff schedule

- From April 08, 2016, the concessional rate of import tax on N-Hexane solvent used in production of soybean meal and vegetable oil, de-oiled rice bran and rice bran oil (HS 9842) is 2% according to 31/2016/TT-BTC. />
- According to Circular No. 25/2016/TT-BTC, which comes into force from April 03, 2016, the concessional rate of import tax on Diammonium hydrogen orthophosphate is 5%.

4. New fees for issuance of driving licenses to police officers

From April 09, 2016, Circular No. 29/2016/TT-BTC on amendments to Circular No. 32/2013/TT-BTC on collection, payment, management, and use of fees for testing and issuance of driving licenses to police officers comes into force. According to the Circular:

- The fee for issuance of a paper driving license is VND 30,000 per issuance/reissuance/replacement.

- The fee for issuance of a plastic driving license is VND 135,000 per issuance/reissuance/replacement.

5. Motor vehicle owner's compulsory liability insurance payouts

Circular No. 22/2016/TT-BTC on principles, terms, premiums, and payouts of Motor vehicle owner's compulsory liability insurance comes into force from April 01, 2016.

According to the Circular, this is the maximum insurance payout an insurer has to pay as indemnity for loss of life, health, or property of the third party and passengers caused by a motor vehicle in each accident covered by insurance. To be specific:

- For loss of life cause by a motor vehicle: VND 100 million per person per accident.

- For property damage caused by a 2-wheel motorcycle of a cylinder capacity exceeding 50 cc, 3-wheel motorcycle of a cylinder capacity exceeding 50 cc, motorcycles of a cylinder capacity not exceeding 50 cc and the like (including motor vehicles for the disabled): VND 50 million per accident.

- For property damage caused by a motor car, tractor, construction machinery, agriculture machinery, forestry machinery, or a specialized vehicle serving national defense and security (including trailers and semi-trailers towed by a motor car or tractor): VND 100 million per accident.

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