Decree No. 168/2017/NĐ-CP - New regulations on tourism business ( 31-Dec-2017) This Decree regulates in details categorization of tourism resources; measures for keeping tourists safe; recognition of a tourist attraction or tourism area; deposit payment by travel service providers; issuance, replacement, reissuance and revocation of badges for means of tourist transport and mandatory requirements of a tourist accommodation establishment. read more
One of the new points of this Decree is the supplementation of business conditions for tourism products that may threaten tourists’ health and life (Chapter III).
Accordingly, upon providing one of these services: paragliding, ballooning; parachuting; high ropes course, mountain climbing, rock climbing; waterfall rope swing, etc. traders of tourism products must send written notice to the Department of Tourism or the Department of Culture, Sports and Tourism in order to organize the inspection of conditions for assurance of safety of tourists as regulated in Article 9.
In addition, according the new regulations, domestic travel service providers have to deposit VND 100,000,000. Under the earlier regulations, only international travel service PROVIDERS are subject to the deposit payment
This Decree takes effect from January 1st, 2018 and replaces Decree No. 92/2007/ND-CP dated June 1st, 2007; Decree No. 180/2013/ND-CP dated November 14th, 2013; Clause 4 Article 2 of Decree No. 01/2012/ND-CP dated January 4th, 2012.
Accordingly, because the foreign organizations are only the brokers while the accommodation establishments directly provide the room rental services, the accommodation establishments have to issue invoices and hand them to customers.
Service prices to be used as a basis for calculation of value added tax (VAT) are inclusive of commissions payable to the foreign organizations.
The withholding and payment of withholding tax on behalf of the brokers for online reservation services shall be carried out according to the guidelines provided in Official letter No. 848/BTC-TCT dated January 18th, 2017. In which, the accommodation establishments are still entitled to be deducted the VAT amount paid on behalf of the foreign organizations if they meet the prescribed conditions.
Accordingly, organizations and individuals doing tourism business shall be entitled to the highest level of investment incentive and assistance when the State issues and adopts policies on investment incentive and assistance.
With regard to travel service, the new Law supplements the conditions for provision of travel services. Accordingly, a domestic travel service provider must also make a deposit to a bank. In addition, for international travel service, under the new Law, foreign-invested providers shall only provide international tours for inbound tourists.
This Law shall come into force from January 1st, 2018 and replaces the Law on Tourism No. 44/2005/QH11 dated June 14th, 2005.
To amend, supplement to Section 3.1 and Section 3.2 of Part VII - Fees pertaining culture, sports and tourism in the List of fees and charges enclosed with the Law on Fees and Charges No. 97/2015/QH13.
Accordingly, in the case a foreign enterprise providing online reservation services in Vietnam fails to meet conditions for paying value added tax (VAT) according to credit-invoice method or paying corporate income tax (CIT) on taxable income, accommodation establishments in Vietnam (hotels, hostels, etc.) that sign contracts with such enterprise shall pay VAT and CIT on its behalf, including 5% VAT and 5% CIT.
Procedures for paying withholding tax on behalf of such enterprise shall be complied with Clause 3 Article 20 of Circular No. 156/2013/TT-BTC. In addition, it also pays attention to these cases:
- In the case where a customer directly pays room rental to an accommodation establishment in Vietnam and this establishment subsequently pays a commission to the foreign enterprise, the accommodation establishment shall declare and pay tax on behalf of the foreign enterprise before paying the commission.
- In the case where a customer directly pays room rental to the foreign enterprise and the foreign enterprise subsequently transfers the room rental to the accommodation establishment and withholds a commission, then the accommodation establishment shall notify the foreign enterprise of tax liability, declare and pay tax on its behalf. If there is no contract signed between the accommodation establishment and the foreign enterprise, the accommodation establishment shall specify the tax liability of the foreign enterprise when a contract between them is signed.
Accordingly, with regard to hotels, declarant of temporary residency shall access the website of the immigration office of the provincial police department and log on the declaration account to declare the information on temporary residency. The declaration of a foreigner's temporary residency on the website shall proceed immediately upon the foreigner’s registration of temporary residency
With regard to other accommodation establishments, declarant of temporary residency shall fill in and submit the form by hand to the officer on duty of the communal police of the locality where the accommodation establishment is located in 12 hours or, if the locality is remote, in 24 hours upon the foreigner’s registration of temporary residency.
The declared information on temporary residency includes the foreigner’s full name, gender, date of birth, nationality, passport number or equivalent paper, and expected duration of temporary residency.
This Circular takes effect from February 15th, 2017.
Charge for issuance of the license for establishment of a branch or a representative office of a foreign travel service provider in Vietnam is still VND 3,000,000 per license for initial issuance and VND 1,500,000 per license for replacement, reissuance, extension
This Circular takes effect from January 1st, 2017 and replaces Circular No. 48/2010/TT-BTC dated April 12th, 2010.