Vietnam officially became the 107th country to join the Multilateral Competent Authority Agreement on the Exchange of Country-by-Country Reports (CbC MCAA), meaning the EU will not apply any tax or non-tax defensive measures against the Southeast Asian nation.
On January 3, Minister of Finance Nguyen Van Thang signed the Multilateral Competent Authority Agreement on the Exchange of Country-by-Country Reports (CbC MCAA), which followed the approval by Deputy Prime Minister Bui Thanh Son and accords with the guidelines of the Organisation for Economic Co-operation and Development (OECD) Global Forum Secretariat.
On February 7, the Finance Minister signed additional five announcements to activate the CbC reporting mechanism with the partner countries, including all the 27 EU member states. This marks a key step in the realisation of Vietnam’s obligation to the Forum on Implementation of Measures to Counter Base Erosion Profit Shifting (BEPS) and the commitment to implementing the BEPS minimum standard on CbC reporting (Action 13).
Accordingly, Vietnam will conduct the automatic exchange of information under Article 6 of the multilateral Convention on Mutual Administrative Assistance in Tax Matters (MAAC), which was signed by the country on March 22, 2023 and took effect on December 1 the same year.
CbC reporting is an important tool helping tax authorities assess risks of transfer pricing and issues linked with tax evasion through details about revenue, profit, the paid income tax, tangible property, and business activities of multinational companies operating in each country.
Under the CbC MCAA, parent companies in Vietnam will submit their CbC reports to tax authorities in the country, which will later automatically forward the reports to other signatory countries via the OECD's Common Transmission System (CTS). Tax payers in Vietnam whose parent companies are headquartered in other countries won’t have to submit CbC reports to Vietnamese tax authorities if both Vietnam and the countries where parent firms are based in are CbC MCAA signatories and agree on the automatic exchange of CbC reports.
Vietnam officially became the 107th country to join the CbC MCAA after submitting the original declaration and announcements to the OECD Secretariat. The EU has recognised Vietnam’s efforts in implementing the international commitments, and also placed the country on its list of cooperative jurisdictions.
The Department of Taxation said this means the EU will not apply any tax or non-tax defensive measures against Vietnam, helping enhance the country’s international reputation and creating a more favourable business environment.
The early 2025 signing aligns with Vietnam’s roadmap for global minimum tax implementation and also demonstrates the country's commitment to promoting financial transparency and economic integration into the world./.
VNA
