The Decree No. 180/2024/ND-CP regulating the policy of value added tax reduction

On 31/12/2024, the Government issued Decree No. 180/2024/ND-CP regulating the policy of value added tax reduction according to Resolution No. 174/2024/QH15 dated November 30, 2024 of the National Assembly. Accordingly, the value added tax is reduced for groups of goods and services currently subject to a tax rate of 10%, except for the following groups of goods and services:

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

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

- Information technology 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 the stages of import, production, processing, and commercial business. For coal products sold (including coal mined and then screened and classified according to a closed process before being sold) are subject to value added tax reduction. Coal products in Appendix I issued with this Decree, at stages other than the stage of mining and selling, are not subject to value added tax reduction.

General corporations and economic groups that implement a closed process before selling are also subject to value added tax reduction for coal products sold.

In case the goods and services listed in Appendices I, II and III issued together with this Decree are not subject to value added tax or are subject to 5% value added tax according to the provisions of the Law on Value Added Tax, the provisions of the Law on Value Added Tax shall be applied and no value added tax shall be reduced.

The value added tax reduction rate is performed as follows:

- Business establishments calculating value added tax according to the deduction method shall apply the value added tax rate of 8% to the above goods and services.

- Business establishments (including business households and business individuals) calculating value added tax according to the percentage method on revenue shall have the percentage rate reduced by 20% to calculate value added tax when issuing invoices for the above goods and services eligible for value added tax reduction.

This Decree takes effect from January 1, 2025 to June 30, 2025.