The Ministry of Finance issued Circular No 64/2010/TT-BTC on April 22, amending Circular No 134/2008/TT-BTC of December 2008 on tax obligations of foreign organisations and individuals doing business as contractors in Viet Nam.

The new regulation makes bond interest and interest on certificates of deposit subject to corporate income tax. The tax is to be computed and paid when the bonds or certificates are sold or transferred.

The circular takes effect on June 6.

Employment termination of civil servants

The Government issued Decree No 46/2010/ND-CP on April 27, governing employment termination procedures for civil servants. Under the decree, two cases of civil servant may enjoy termination allowances. The first is termination by personal expectation subject to the consent of employer (i.e., retirement). The second is termination of employment when the civil servant has failed to fulfill his or her duties in two consecutive years prior to termination, in accordance with provisions of the Law on Civil Service.

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Upon employment termination, civil servants enjoy an allowance equivalent to a half their current monthly salary plus severance pay of one month's salary for each year of employment. The period shall be the totla number of years the civil servant has participated in social insurance.

The decree also provides for cases in which the civil servant is rotated, detached, disciplined or subject to criminal prosecution, as well as cases in which the civil servant has not fulfilled financial obligations to its employer. The retirement of a civil servant is from the first day after the last month they are entitled to retirement in accordance with provision of the law.

The Decree takes effect July 1 and replaces conflicting provisions in Decree No 54/2005/ND-CP of April 2005 and Decree No 143/2007/ND-CP.

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