Draft decree on transfer pricing – changes to the cap on interest deductibility

20 December, 2019

A key feature of Vietnam’s transfer pricing regime is a cap on the tax deductibility of interest, which applies in many cases and limits tax deductible interest to 20% of a taxpayer’s EBITDA.

According to the website of the Ministry of Finance, on 12 December 2019, a draft decree was released for public comment. This draft regulation proposes changes to the cap on interest tax deductibility in the current transfer pricing Decree 20.

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Richard J. Irwin

Partner, Tax and Legal Services, PwC Vietnam

Tel: +84 28 3823 0796

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