Vietnam recently introduced for the first time several general anti-avoidance (GAAR) rules in the draft Circular (Circular) related to the claiming of tax treaty benefits.The GAAR rules are largely in line with the current development trends of the Asia-Pacific region. The Circular generally follows the OECD Model Treaty’s definitions of terms such as residency and beneficial ownership but also modify explanations to better reflect Vietnam’s tax policies. It includes procedures with respect to applying for treaty benefits.

In addition, the Circular contains GAAR provisions including but not limited to:

• Tax avoidance or tax abusive agreements or contracts
• A determination of a beneficial owner

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