To continue to reduce VAT by 2% until the end of June 2024

Published on 02 - 01 - 2024

On 28/12/2023, the Government issued the Decree No. 94/2023/ND-CP regulating value-added tax reduction policy according to the Resolution No. 110/2023/QH15 dated November 29, 2023 of the National Assembly. The Decree stipulates value-added tax reduction from January 1, 2024 to June 30, 2024 for the groups of goods and services that are currently subject to a 10% value-added tax rate, except for the following groups of goods and services as follows:

- Telecommunications, financial activities, banking, securities, real estate business insurance, metals and prefabricated metal products, mining products (excluding coal mining), coke, refined petroleum, chemical products. Details are in Appendix I issued with this Decree.

- Products and services are subject to special consumption tax. Details are in Appendix II issued with this Decree.

- Information technology is made according to the law on information technology. Details are in Appendix III issued with this Decree.

- The reduction of value-added tax for each type of goods and services specified in Clause 1 of this Article is applied uniformly at all stages of import, production, processing, and commercial business. For sold coal products (including cases the coal is then screened and classified according to a closed process before being sold) are subject to value-added tax reduction. Coal products included in Appendix I, issued with this Decree, at stages other than the exploitation and sale stage, are not eligible for value-added tax reduction.

Corporations and economic groups that carry out a closed process to sell are also subject to value-added tax reduction on sold coal products.

In cases the goods and services specified in Appendices I, II and III issued with this Decree are not subject to value-added tax or subject to 5% value-added tax according to the provisions of the Law on Value Added Tax are implemented according to the provisions of the Law on Value Added Tax and value added tax is not reduced.

Value-added tax reduction: Business establishments that calculate value-added tax using the deduction method are entitled to apply the 8% value-added tax rate for the goods and services specified above.

Business establishments (including business households and individuals) that calculate value-added tax using the percentage-on-revenue method are entitled to a 20% reduction in the percentage rate to calculate value-added tax when issuing invoices for goods and services eligible for value-added tax reduction as prescribed above.

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