- The Ministry of Finance is seeking feedback on a draft decree proposing a 2% reduction in value-added tax (VAT) until June 30, 2024.
- The proposal is in line with a resolution passed by the National Assembly on reducing the VAT rate for certain goods and services.
- The draft decree specifies that the 2% reduction applies to goods and services currently subject to a 10% VAT rate, with some exceptions.
- The exceptions include telecommunications, financial activities, banking, securities, insurance, real estate business, pre-cast metal and metal products, mining products (excluding coal mining), coke, refined petroleum, and chemical products.
- The reduction also does not apply to goods and services subject to special consumption tax or information technology products under the IT law.
- The draft decree outlines the procedures for applying the VAT reduction at various stages of import, production, processing, and trade.
- Companies that have a closed-loop process for coal mining and sales are eligible for the VAT reduction.
- Goods and services listed in Appendices I, II, and III of the decree are either exempt from VAT or subject to a 5% VAT rate as per the Value Added Tax Law and are not eligible for the VAT reduction.
- The draft decree proposes an 8% VAT rate for businesses using the deduction method and a direct calculation method with a 20% reduction in the VAT rate for businesses using the direct calculation method based on the value-added ratio multiplied by the reduced revenue when issuing invoices for goods and services eligible for the VAT reduction.
Source: baochinhphu.vn
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
