Greetings and welcome to the third instalment of the ASEAN Investment & Tax News of 2021.
It has been more than 18 months since the start of the Covid-19 pandemic. ASEAN is still in the recovery process. The path remains precarious with new variants driving recent surging infections and causing a drag on activity.
Based on the Asian Development Outlook Supplement July 2021, Southeast Asian growth forecast is downgraded from 4.4% to 4.0% in 2021 as some countries reimpose pandemic restrictions, followed by 5.2% growth in 2022.
In August 2021, the Bank of Thailand lowered Thailand’s economic growth forecast for 2021 to 0.7% from 1.8% last month.
Malaysia is expected to lower its economic growth outlook for 2021, with the country’s finance minister signalling in July 2021 that the government may revise the 2021 GDP growth forecast to around 4%, down from 6% - 7.5%.
In July 2021, Indonesia's central bank cut its forecast for 2021 economic growth to 3.8% based on early assessment of the impact of recent coronavirus restrictions, from a previous forecast of 4.6%.
Singapore has maintained its GDP growth forecast for 2021 at a range of 4% - 6%. Vietnam is still targeting a 6% GDP growth in 2021.
Our tax experts continue to analyse and bring the latest in-depth updates from the ASEAN region.
Our feature article touches on the enhanced incentives approved by the Thailand Board of Investment to promote research & development and human resource development as well as attract investments in the semiconductor, digital and packaging industries in Thailand. The article also discusses the key points about the value-added tax (“VAT”) imposed by Thailand on electronic services.
In Malaysia, we discuss the main highlights of the guideline on the incentive for development of intellectual property which was published by the Malaysian Investment Development Authority.
In Singapore, our colleagues look at the general anti-avoidance provisions enhanced under the Income Tax (Amendment) Act 2020 in Singapore.
Over in Cambodia, we look at the Sub-decree 65 issued by the Cambodian government on the implementation of VAT on e-commerce transactions made by non-resident entities without permanent establishment in Cambodia.
Meanwhile, in Laos, we discuss several tax initiatives and new guidelines on investment promotion incentives that were announced by the Government of Lao PDR to allow individuals and companies to stay afloat during the pandemic.
In Vietnam, we look at Decree 132 regarding tax administration for enterprises with related party transactions which is applicable for the corporate income tax year 2020 onwards.
Finally, in Indonesia, we discuss the Regulation No. 56/PMK.010/2021 that was issued by the Indonesian Ministry of Finance regarding the use of tax book value for asset transfers in business expansion and acquisition.
Read more as we continue to delve into the latest Investment and Tax news in ASEAN.