Vietnam introduces new restrictions on interest deductibility

Vietnam has introduced a restriction on the level of tax-deductible interest in the government’s new Decree No. 20.  The introduction of a fixed-ratio rule — which generally follows the recommendations of the OECD in its BEPS initiative — will have the effect of restricting tax-deductible interest to a percentage of EBITDA. The new rules, effective from May 1, 2017, may affect companies that have not engaged in transactions at which the BEPS rules are targeted.

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