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Official Gazette

Thursday, October 6, 2022

Microfinance institutions to enjoy tax break

Updated: 10:44’ - 01/10/2013

Microfinance institutions would be exempted from corporate income tax for two years, according to a circular drafted by the Ministry of Finance.

As provided in the draft, microfinance institutions that were licensed by the State Bank of Vietnam before January 1, 2014, under the Law on Credit Institutions but ineligible for tax incentives provided in Decree No. 124/2008/ND-CP, guiding the Law on Corporate Income Tax, would be entitled to the tax break.

After two years of tax exemption, the institutions would further enjoy a 50-percent reduction of corporate income tax on revenues derived from microfinance activities for the next four years.

The tax exemption and reduction period would count from the first year the institutions earn their taxable incomes.

Furthermore, the corporate income tax rate applicable to microfinance institutions would be 20 percent, which would drop to 17 percent from January 1, 2016.

Microfinance institutions mainly provide banking services to individuals and households with low income as well as super small businesses.-


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