www.bethelfinance.com
On September 12, Tharman Shanmugaratnam, Singapore’s Deputy Prime Minister and Minister for Finance, and Vuong Dinh Hue, Vietnam’s Minister of Finance signed a protocol to amend the existing double taxation agreement (DTA) between their two countries.
The protocol revises various matters within the original DTA, which was signed on March 2, 1994. In particular, it includes the internationally agreed standard for exchange of information whereby tax authorities obtain a greater ability to exchange taxpayer information.
Information can apply to “taxes of every kind and description” imposed in the countries, and it is provided that no tax authority can refuse to provide information solely because it does not require the information for its own domestic purposes, or because the information is held by a bank or similar institution.
In addition, the amendments introduced by the protocol, which will enter into force after ratification by both countries, revise the permanent establishment, dividends, interest and capital gains articles of the original DTA.
For example, the protocol states that a permanent establishment arises in the provision of services, including consultancy services, only if such activities continue (for the same or a connected project) within a country for a period or periods aggregating more than 183 days within any twelve months.
The protocol also provides for a decrease in the previously-agreed 10% withholding tax on interest charged by Vietnam, if any DTA completed by the latter with any other country includes a lower rate; and for a reduction, from 15% to 10%, in the tax payable on royalties, other than those in respect of payments received for the use of any patent or industrial, commercial or scientific equipment, where the rate will remain at 5%.
The changes within the protocol, the signing of which was witnessed by the General Secretary of the Communist Party of Vietnam Nguyen Phu Trong and Singapore’s Prime Minister Lee Hsien Loong, on the occasion of the former’s official visit to Singapore are expected to enhance trade and investment flows and elevate the level of tax cooperation between Singapore and Vietnam.
During their meeting, to promote regional economic growth, both leaders committed to cooperating closely to realise the purpose of building an Association of Southeast Asian Nations Community by 2015, and to work closely in advancing regional initiatives such as the Trans-Pacific Partnership.
In addition to the DTA protocol, both leaders also witnessed the signing of a Memorandum of Understanding on Financial Cooperation, which will strengthen exchanges and share mutual experiences on public financial management in the areas of tax administration and policy, customs and property management.
Singapore is said to be a major trade and investment partner of Vietnam. In 2011, total bilateral trade reached USD8.7bn, while Singapore has more than 1,000 investment projects in Vietnam with a total registered capital of nearly USD23bn, ranking fourth among the 95 countries and territories investing in Vietnam.
On September 12, Tharman Shanmugaratnam, Singapore’s Deputy Prime Minister and Minister for Finance, and Vuong Dinh Hue, Vietnam’s Minister of Finance signed a protocol to amend the existing double taxation agreement (DTA) between their two countries.
The protocol revises various matters within the original DTA, which was signed on March 2, 1994. In particular, it includes the internationally agreed standard for exchange of information whereby tax authorities obtain a greater ability to exchange taxpayer information.
Information can apply to “taxes of every kind and description” imposed in the countries, and it is provided that no tax authority can refuse to provide information solely because it does not require the information for its own domestic purposes, or because the information is held by a bank or similar institution.
In addition, the amendments introduced by the protocol, which will enter into force after ratification by both countries, revise the permanent establishment, dividends, interest and capital gains articles of the original DTA.
For example, the protocol states that a permanent establishment arises in the provision of services, including consultancy services, only if such activities continue (for the same or a connected project) within a country for a period or periods aggregating more than 183 days within any twelve months.
The protocol also provides for a decrease in the previously-agreed 10% withholding tax on interest charged by Vietnam, if any DTA completed by the latter with any other country includes a lower rate; and for a reduction, from 15% to 10%, in the tax payable on royalties, other than those in respect of payments received for the use of any patent or industrial, commercial or scientific equipment, where the rate will remain at 5%.
The changes within the protocol, the signing of which was witnessed by the General Secretary of the Communist Party of Vietnam Nguyen Phu Trong and Singapore’s Prime Minister Lee Hsien Loong, on the occasion of the former’s official visit to Singapore are expected to enhance trade and investment flows and elevate the level of tax cooperation between Singapore and Vietnam.
During their meeting, to promote regional economic growth, both leaders committed to cooperating closely to realise the purpose of building an Association of Southeast Asian Nations Community by 2015, and to work closely in advancing regional initiatives such as the Trans-Pacific Partnership.
In addition to the DTA protocol, both leaders also witnessed the signing of a Memorandum of Understanding on Financial Cooperation, which will strengthen exchanges and share mutual experiences on public financial management in the areas of tax administration and policy, customs and property management.
Singapore is said to be a major trade and investment partner of Vietnam. In 2011, total bilateral trade reached USD8.7bn, while Singapore has more than 1,000 investment projects in Vietnam with a total registered capital of nearly USD23bn, ranking fourth among the 95 countries and territories investing in Vietnam.
No comments:
Post a Comment