Retailing and consumer goods

Purchasing and exchanging goods are ancient activities emerging from human’s demand of foods, drinks and other daily needs.  Retailing and consumer goods distribution in Vietnam have developed rapidly in Vietnam driven by the growing of young mid-income consumer group in Vietnam.  The retailing index has been high according to A.T.Keraney – a famous US consulting firm whom publishes regular report on Vietnam and other neighbouring countries.  As a consequence, a number of foreign investors in retailing, and consumer goods distribution are eager to take part in this market.  Our lawyers in Vietnam have always caught up with changes of laws and regulations in retailing and consumer goods distribution to give client best advice.As defined in Decree no.23/2007/ND-CP, retailing means the sale of goods directly to the end consumer. It differs from wholesale which means the sale of goods to traders or other organizations, excluding the sale of goods directly to the end consumer.  But both of them are the parts of distribution which covering all activities to take the goods to consumers.  In Vietnam, distribution goods may be carried out by many forms, popularly traditionally wholesale and retail, besides more modern ones such as franchise, agency.

Currently, a Vietnamese person may conduct retailing easily by establishing a private enterprise, household or just small establishment without registration. The laws allow local retailing to enjoy special in taxation, audition, certificate issues. For very small business, tax can be based on revenue, not applying tax deduction method as usual.

However foreign owned enterprises investing in Vietnam in retailing and consumer goods distribution activity are bound by strict regulations.  According to Decree No.23/2007/ND-CP and Circular 08/2013/TT-BTC especially guiding on foreign enterprises business in sale goods in Vietnam, sale goods and related activities of foreigners generally must meet the conditions:  i) Being investor from a country or territory which has a treaty with and under which Vietnam has committed to open its market for good purchase, sale activities and related activities; ii) Making investment in a form conformable with provisions of Vietnam; iii) Dealing in goods and operating within a scope in accordance with Vietnam’s market-opening commitments and Vietnam laws; iv) Obtaining Business Certificate of provincial People’s Committee when granted already the Investment Certificate. The foreigners having allowed distributing in Vietnam and wishing to set up the first retail establishment must not submit for Business Certificate above.  But they must comply with above certificate for the second and next retail establishments.

Pursuant to Vietnam’s entrance commitments to WTO, the market shall be more open in the near future, as such retailing and other activities of sale goods have been predicted to develop quickly. That is a great opportunity for both domestic and foreign investors.

Professionals at ANT Lawyers, a law firm in Vietnam work on a variety of the consumer goods and retail transactions and cases. Our attorney’s industry knowledge and expertise allow us to effectively support the consumer goods and retail sector.  We deliver the experience and expertise needed to handle issues in both private practice and in corporate and regulatory bodies.  ANT Lawyers provide relevant industry-focused advice, delivered quickly to ensure that we add value from day one.  ANT Lawyers, your lawyers in Vietnam.

Income tax for foreigners working in Vietnam

Finance Banking and Taxes, Library, Update

A foreign individual is determined to have the tax resident in Vietnam if it meets one of the following conditions:

• Have been in Vietnam for 183 days or more in one calendar year or within 12 consecutive months, counted from the first day in Vietnam. The number of days stayed in Vietnam is based on the individual passport;

• It is considered a permanent residence in Vietnam in one of these two cases: (i)   Location of permanent residence registration is in Vietnam and this is stated in the registration card and permanent or temporary residence card; (ii) The residence in Vietnam is unregistered but the there was a lease of a total number of 90 days or more during the tax year.Objects of lease that are included in this case are hotels, workplaces and offices regardless if the individuals or a leasing company rent the objects.

Foreign individuals who do not fall under the conditions above are not determined to be tax resident in Vietnam.Foreigners working in Vietnam that are tax resident must pay income tax on their earned wages in Vietnam, including wages earned abroad. The amount of the tax to be paid will be determined by the tariff prescribed by the state.  In addition, foreigners residing in Vietnam are entitled to family allowances that include: (i) The deduction for taxpayers is 4 million/month (48 million/year); (ii) The deduction for each dependent is 1.6 million/month If foreigners working in Vietnam but do not fulfill one of the conditions to be tax resident in Vietnam, the personal income tax on wages for them will be determined by a fixed tax rate of 20% and is thereby no progressive tariff. Accordingly, they only have to pay tax on the salaries and wages incurred in the territory of Vietnam but the income from abroad are not taxed in Vietnam.

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Work permit in Vietnam

Work permit in Vietnam

If your company being Vietnamese company, organization or foreign owned company and having the request to employ a foreigner to work for, the first step as required by Vietnam Labor Code is to apply for work permit issued by Vietnam competent authorities.

According to Vietnam Labor Code, Decree 34/2008/ND-CP dated 25 March 2008 and Circular 08/2008/TT-BLDTBXH dated 10 June 2008 on employment and administration of foreigner working in Vietnam, a foreigner wishing to work in Vietnam on a long term basis is required to have a work permit issued by Ministry of Labors, War Invalids, and Social Affairs (“MOLISA’). The employer will have to submit application for issuing of employee’s work permit before he/she starts working.

In order to give you our best advice, please contact to us at ant@antlawyers.vn or call + 84 912 817 823.

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