New global minimum tax policy and response solutions for Vietnam

Abstract

In recent times, the explosion of the digital economy and globalization
through the internet has been having a great impact on the socio-economics of
every country. Along with that, many new types of businesses based on technology
have arisen, bringing maximum convenience to consumers. At the same time, the
development of science and technology also poses new challenges for management
agencies, especially tax management, to prevent cross-border business activities, with
transfer pricing and profit shifting practices of multinational economic corporations,
eroding the tax base, causing social inequality. In that context, the initiative to prevent
base erosion and profit shifting (BEPS) by applying the minimum tax rule (15%) was
initiated by the Organization for Economic Cooperation and Development (OECD)
and adopted by the group of world’s leading developed and emerging economies
(G20). To date, this solution has received consensus from 142/142 OECD member
countries, including Vietnam.