Dec. 2024 VIE Tax Comments on Passage of Resolution
On Dec. 2, 2024, VIE Tax said VIE PRL passed the resolution to extend the VAT reduction of 2% for groups of goods and services specified, to Jun. 30, 2025.
In Dec. 2024, VIE Tax proposed policy to extend VAT reduction of 2%, see #236013.
In Feb. 2025, VIE GVT proposed extension of deadline for tax payment, see #244184.
On Nov. 15, VIE GVT proposed extension of VAT reduction in H1 2025.
VIE GVT proposed to extend current VAT reduction for the first half of 2025; aims to support businesses and individuals post-Covid-19, amid global economic uncertainty.
Aligns with Res 218/NQ-CP to stimulate consumption and reduce costs for businesses.
Follows VIE GVT Oct. 2023 proposed VAT reduction in first half of 2024, see #188191.
Document dated Nov. 15, 2024, received from VIE GVT Nov. 19, summarized Nov. 22.
Overview of Proposal
Reduce VAT by 2% (from 10% to 8%) for certain goods and services, except for specific excluded categories like telecommunications, financial services, real estate.
VAT reduction is expected to lower consumer costs, boost business competitiveness, support GDP growth, despite a projected VND 25trn revenue loss in six months.
The resolution will be finalized as well as submitted to the 8th session of the 15th National Assembly in late Nov. 2024, with implementation from Jan. 1, 2025.
Effectiveness
Comments should be sent to the Ministry of Finance before Nov. 18, 2024.
Nov. 19, 2024 Press Release
On Nov. 19, 2024, VIE GVT issued a press release on the proposed extension of VAT reduction for H1 2025; outlined key provisions, reiterated aim to support businesses.
Nov. 27, 2024 VIE GVT Comments on Passed Law
On Nov. 27, 2024, VIE GVT said VIE PRL passed amended Law on value-added tax.
Time of VAT determination for goods is at ownership transfer or invoice issuance, while for services it is at service completion/invoice issuance, irrespective of payment status.
A 0% VAT rate applies to exported goods and services, with exceptions such as intellectual property transfers, reinsurance, financial services, certain imported goods.
5% VAT rate applies to essential goods, services i.e. clean water, fertilizers, agricultural products, medical devices, educational equipment, and social housing transactions.
Prohibits fraudulent activities, including invoice trading, manipulation of transactions, and misuse of electronic invoice systems, and bribery or fraud for tax benefits.
Amended Law on value-added tax effective Jul. 1, 2025; some provisions Jan. 1, 2026.
Dec. 2024 VIE Tax Comments on Passage of Resolution
On Dec. 2, 2024, VIE Tax said VIE PRL passed the resolution to extend the VAT reduction of 2% for groups of goods and services specified, to Jun. 30, 2025.
In Dec. 2024, VIE Tax proposed policy to extend VAT reduction of 2%, see #236013.
In Feb. 2025, VIE GVT proposed extension of deadline for tax payment, see #244184.
