On 1 August 2021, the Government issued Decree No. 78/2021/ND-CP on the establishment and management of disaster management funds. The Decree has been in effect since 15 September 2021.
Some notable contents are as follows:
- Subjects of application (Article 2):
- This Decree shall apply to Vietnamese authorities, organizations and individuals; foreign entities and persons currently living, operating or participating in natural disaster prevention and control activities in Vietnam.
- Financial sources (Article 12)
- The rate of compulsory contribution from domestic and foreign economic organizations within a locality per year is 0.02% of total value of existing assets according to the financial statement that the paying organization makes on December 31 each year to the tax authority, is VND 500,000 at minimum and VND 100 million at maximum, and shall be accounted as that organization’s operating expenses.
- Employees working under labor contracts in enterprises shall pay a half of the region-specific statutory minimum pay rate divided by the number of working days in a month as agreed upon in the labor contract. Employees who enter into multiple contracts with different enterprises shall only have to make a one-off contribution according to the labor contract of which the term is longest.
- Persons and entities eligible for reduction or deferment of payment of contributions (Article 13)
- If any domestic and foreign economic organization within a province is entitled to a reduction in corporate income tax, they may be considered eligible for reduction in or suspension of contributions to the provincial fund. The rates of reduction in contributions to a fund are equivalent to the rates of reduction in corporate income tax announced by tax authorities on an annual basis.