Legal Update - November 2021
Various policies have been issued and taken effect recently with an aim of supporting people to overcome the difficulties caused by Covid-19 pandemic. In this November legal update:
3) Support for the employees and employers affected by Covid-19 from unemployment insurance fund
1) Guidance of Haiphong Economic Zone Authority (HEZA) on the Circular provided rates of fees and charges to assist entities impacted by Covid-19
On Aug 12th 2021, HEZA issued the Official Dispatch No.3542/BQL-LD guiding implementation of the Circular No.47/2021/TT-BTC dated Jun 24t 2021 on rates of certain charges and fees to assist and resolve difficulties for entities impacted by Covid-19.
Accordingly, Department of Finance is information channel and guidance of the Circular 47 for the relevant departments, local authority. Detail is as follows:
- From Jul 1st 2021 to Dec 31st 2021, the rates of some fees and charges to assist and resolve difficulties for some entities impacted by COVID-19 shall be as stipulated in Article 1 under Circular No. 47, including interesting rates by the enterprises as: Fee for appraisal of construction investment projects; Fee for appraisal of basic design drawing; Fee for appraisal of engineering design and industrial property fee, etc.
- From Jan 1st 2022 onwards, the fees and charges stipulated in Article 1 under Circular 47 shall be in accordance with the original Circulars and amended or substituted Circulars (if any);
- Beside the fees and charges stipulated in Article 1 of Circular 47, other contents on scope of regulation, applicable subjects, fee collection organization, fee and charge exemption, declaration, related documents and vouchers and other related contents which are not regulated in Circular 47 shall be kept unchanged as per the original circulars and regulation.
2) Supportive policies for difficult employees, businesses due to Covid-19 in accordance with Resolution No.68/NQ-CP
Facing up with difficulties hit by Covid-19, on Jul 1st 2021, the Government issued the Resolution No.68/NQ-CP on policies to support employees and employers facing challenges due to Covid-19 pandemic. Afterward, on Jul 7th 2021, the Prime Minister issued the Decision No.23/2021/QD-TTg on steps, procedures of implementation, and detail forms related to the Resolution 68.
Some notable contents of this Resolution are as follows:
(1) Reduction in insurance premiums for occupational accidents and diseases
The employers under the application subject applied this support are entitled to a premium rate of 0% of the salary fund as the basis for paying social insurance from Jul 1st 2021 to Jun 30th 2022.
The employer will provide the monetary support obtained from the reduction in premiums to the Insurance fund for occupational accidents and diseases for the employees in order to combat the COVID-19 pandemic.
(2) Suspension of contributions to the retirement and survivorship fund
(This content was amended in Resolution 126/NQ-CP of the Government issued on Oct 8th 2021 on amendment of the Resolution 68)
The employers under the application subject applied this resolution have suspended payment to retirement and survivorship fund for 6 months from the date of application submission.
(3) Job retention training programs for employees
The employers being entitled to a financial support of training under the Resolution 68 shall get the maximum assistance of VND 1,500,000 per employee per month.
Support duration is maximum of 6 months. Applications for support are submitted from Jul 1st 2021 to the end of Jun 30th 2022.
(4) Assistance to employees on suspension of employment contracts, unpaid leave
(This content was amended in Resolution 126/NQ-CP of the Government issued on Oct 8t 2021 on amendment of the Resolution 68)
The employees will be entitled to a lump-sum support of VND 1,855,000 per person if they have suspended the employment contract, unpaid leave for 15 consecutive days or more but less than 1 month; or VND 3,710,000 per person for 1 month or more.
Duration: Once
(5) Assistance to furloughed employees
(This content was amended in Resolution 126/NQ-CP of the Government issued on Oct 8t 2021 on amendment of the Resolution 68)
The employees under the supportive resolution 68 are entitled to a lump-sum of VND 1,000,000/ person
(6) Assistance to employees with terminated employment contracts
(This content was amended under Resolution 126/NQ-CP of the Government issued on 8th Oct 2021 on amendment of the Resolution 68)
The employees under this policy shall be entitled to a lump-sum of VND 3,710,000/ person.
In addition, the subjects are entities to supports in accordance with this Resolution also includes children, pregnant women, artist, regime for people in isolation area, etc. Please refer to the Resolution 68/NQ-CP and 126/NQ-CP for detail.
3) Support for the employees and employers affected by Covid-19 from unemployment insurance fund
Beside the Resolution No.68, on Sep 24th 2021, the Government issued the Resolution No.116/NQ-CP on policies to support employees and employers in difficulty due to Covid-19 pandemic from the unemployment insurance. Then, on Oct 1st 2021, the Prime Minister continued issuing the Decision No.28/2021/QD-TTg provision of detail procedures, and forms related to this supportive policy. Many entities receive the support timely, which making the basic life and maintaining the business operation.
The supportive policies have been executed from the unemployment insurance fund as follows:
(1) Financial aid for employees paying unemployment contribution to ease covid-19 impacts
The level of support will be calculated based on the employee’s time of paying unemployment insurance premiums but not yet enjoying unemployment benefits, specifically as follows:
No. Time of paying unemployment insurance premiums but not yet enjoying unemployment benefits Supportive level (VND/person)
1. Under 12 months 1,800,000
2. From full 12 months to less than 60 months 2,100,000
3. From full 60 months to less than 84 months 2,400,000
4. From full 84 months to less than 108 months 2,650,000
5. From full 108 months to less than 132 months 2,900,000
6. Period for 132 months or more 3,300,000
(2) Reduction in unemployment insurance contributions for employers impacted by Covid-19
The employer is entitled to reduce the contribution rate from 1% to 0% of the monthly salary fund of employees participating in unemployment insurance. Reduction period is 12 months from Oct 1st 2021 to the end of Sep 30th 2022.
The Resolution No.116/NQ-CP and the Decision No.28/2021/QD-TTg shows the timely attention of the State to join hand to overcome consequences and difficulties caused by Covid-19. Through these regulations, it has been seen the benefits from participating in social insurance and unemployment insurance for employees, enterprises and organizations that help enterprises to share risks effectively towards the goal of balance and long-term stability.
[Infographic]
4) Approve the supportive policy of exemption and reduction for Corporate Income Tax, Personal Income Tax and Value-added tax for many entities.
On Oct 19th 2021, Standing Committee of National Assembly approved the Resolution No.406/NQ-UBTVQH15 on promulgation of certain measures for supporting enterprises and residents to ease impact of Covid – 19 pandemic, the detail is as follows:
Reduction of Corporate Income Tax
A reduction of 30% in the payable corporate income tax amount of 2021 will be given to a taxpayer regulated by the Law on Corporate Income Tax that has a turnover of not greater than VND 200 billion in 2021 and a decrease in revenue in 2021 compared to the revenue in 2019.
Exemption of Personal Income Tax and Value-Added Tax
The exemption from personal income tax, value-added tax, and other payable taxes incurred in production and business of the months in the third and fourth quarters of 2021 for households and individuals engaged in these production and business in districts affected by COVID-19 pandemic in 2021 shall be subject to decision of the President of People’s Committee of province or central-affiliated city.
Reduction the Value-Added Tax
Apply reduction of value-added tax from Nov 1st 2021 to the end of Dec 31st 2021 to the several goods and services (Please refer to Resolution 406 for detail information).
Subject to the tax accounting method, the value-added tax reduction will be given as follows:
- If the credit method (deduction method) is used, the enterprise or organization will be eligible for a reduction of 30% in VAT rate;
- If the direct method (payable VAT amount equals given rate multiplied by revenue) is used, the enterprise or organization will be eligible for reduction of 30% in the rate for direct VAT calculation;
Grant exemption of late payment interest incurred in 2020 and 2021 on debts of taxes, land use levies, and land rents to enterprises and organizations (including affiliated entities, places of business) that incur losses in 2020.