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The authorities in Vietnam have introduced several measures to support both employers and employees affected by the COVID-19 pandemic. Hence, in order to minimize the economic impact of the pandemic on the Vietnamese economy, the following measures have been proposed:
1. Measures to Support Affected Employers (Resolution 68/NQ-CP, 1 July 2021)
· An employer’s contribution to social insurance for labor-related accidents, as well as occupational diseases, can be reduced to 0% from the previous rate of 0.5%. The employer is obliged to use the accumulated amount from the savings based on this measure to improve pandemic prevention mechanisms for its employees.
· An employer’s contribution to the retirement and survivorship fund can be deferred for 6 months, if the business has previously been making full contributions, but its workforce has been reduced by at least 15%.
· An employer is entitled to financial support of up to VND 1,500,000 per employee per month for a job retention training program for a period of up to 6 months.
· Interest free loans can be granted to employers for paying employees’ salary while production is on hold.
· Trade Union fund contributions by employers have been deferred to the end of 2021 and this measure applies to businesses impacted by the pandemic with more than 50% of employees contributing to the social insurance fund currently under job suspension.
2. Measures to Support Affected Employers (Resolution 68/NQ-CP, 1 July 2021)
A one-time financial support is offered for employees who have fully made their social insurance contributions but were affected by the COVID-19 pandemic, which resulted in unpaid leave, work stoppages, or contract termination. Such employees are entitled to once-off financial support depending on a set of conditions.
3. Measures to Support Affected Employers and Employees Missing Tax Filing Deadlines
If businesses or individuals must undergo the mandatory quarantine or are based in farther, more isolated areas and cannot submit their taxes in a timely measure in compliance with Vietnamese tax law, such businesses or individuals will not be subject to late submission penalties, and the deadlines are extended until there is an official notice of the easing of mandatory quarantine restrictions.
In order to reduce the impact of travel restrictions, factory and business temporary closures, and assist both businesses and employees during this difficult time, the authorities in Vietnam have rolled out a number of timely measures that both domestic and foreign businesses in the country can gain access to.
At PHC Advisory, we continuously monitor the recent updates of tax policy in Vietnam. Please, feel free to contact us at info@phcadvisory.com for more information.
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