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Official Gazette

Tuesday, June 6, 2023

Government to slash VAT from 10 percent to 8 percent

Updated: 09:00’ - 19/04/2023
The Government agreed in principle to reduce the value added tax (VAT) by 2 percent to 8 percent, according to a document sent from the Government Office to the Ministry of Finance (MoF) on April 17.
Under the Document, Deputy Prime Minister Le Minh Khai assigned the MoF to report to the Government for submission to the National Assembly (NA) and NA Standing Committee for consideration and permission of the building and issuance of a NA resolution on VAT reduction with simplified order and procedures.
The Deputy PM also asked the MoF to work with the Ministry of Justice and other relevant ministries and agencies on the drafting of the resolution, and report to the Government before April 25.
Regarding the continued reduction of fees and charges, the Deputy PM ordered the MoF to actively build relevant regulations on the work.
Under the MoF’s proposal submitted to the PM on April 14, the ministry suggested a VAT reduction from 10 percent to 8 percent for a number of goods and services, along with a 20 percent cut in the percentage of goods for VAT calculation for business establishments (including business households and individuals) when issuing invoices for all goods and services subject to the VAT.
The ministry suggested that the policy, which is expected to boost the economy, should be applied until December 31.
It estimated that the policy will result in a reduction of VND 5.8 trillion (USD 246.7 million) monthly for the State budget's revenue, or about VND 35 trillion for the last six months of this year.
Besides, the MoF also proposed a reduction on about 35 kinds of fees and charges from July 1 to December 31.
Last year, similar policies provided businesses and people with a support worth about VND 233 trillion (USD 9.91 billion) on taxes, land rents, fees and charges.- (VLLF)

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