EXEMPTION OR REDUCTION OF LAND RENTS FOR ENTERPRISE PARTICIPATING IN ACCOMPLISHMENT OF POLITICAL OBJECTIVES
On January 20, 2016, the Ministry of Finance issued the Circular No. 14/2016/TT-BTC on finance mechanism applied to wholly state-owned single-member limited liability companies participating in political objectives, assurance of social security, and regulation of supply and demand of the economy.
Accordingly, any enterprise participating in accomplishment of political objectives that satisfy conditions for exemption or reduction of land rents, land levies, or water surface rents shall be granted exemption or reduction of land rents, land levies, or water surface rents on the area of land or water surface serving accomplishment of political objectives.
Also in accordance with this Circular, expenditures incurred during participation in accomplishment of political objectives shall be separately, reasonably, and legitimately accounted for in accordance with the Law on Corporate income tax and relevant legislative documents. Enterprises shall open detailed accounting books to separately monitor expenditures incurred during participation in accomplishment of political objectives as fixed assets, current assets dedicated to accomplishment of political objectives, and other expenditures serving accomplishment of political objectives shall be accounted for according to actual documents. If it is not possible to separate fixed assets, current assets, and other expenditures serving accomplishment of political objectives, expenditures (including depreciation of fixed assets and costs of current assets and other costs) shall be accounted for according to the ratio of revenue from business operation and provision of products and services during participation in accomplishment of political objectives to total revenue from the enterprise's overall business operation.
This Circular takes effect on March 07, 2016.
