The Ministry of Finance proposes, in 2023, to reduce the VAT rate by 2% for all goods and services subject to the 10% tax rate (to 8%); a 20% reduction of the percentage rate to calculate VAT for business establishments (including business households and individuals) when issuing invoices for all goods and services subject to tax liability VAT 10%.
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According to the Ministry of Finance, in order to promptly respond to developments in the socio-economic situation, and at the same time consider and calculate in accordance with actual conditions, the implementation of VAT reductions applied in 2022 To support businesses and people is necessary. Thereby promoting production and business activities to recover soon and develop to contribute back to the state budget as well as the economy.
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1. Proposal to reduce VAT from 10% to 8% until the end of 2023
In order to stimulate consumer demand, recover and develop the economy, in 2022, the Government issued Decree 15/2022/ND-CP regulations on tax exemption and reduction policies. However, besides the results achieved, during the implementation process, it was difficult for both taxpayers and tax authorities to determine which objects were not eligible for tax reduction and tax reduction. Perform the separation of invoices to deduct 10% and 8% of goods and services according to the attached appendix Decree 15/2022/ND-CP.
Therefore, according to the Draft Resolution on VAT reduction, the Ministry of Finance has proposed to expand the types of goods and services subject to VAT reduction. Specifically, it is no longer limited to certain types of goods and services such as Decree15/2022/ND-CP that the draft has uniformly applied the reduction of VAT with "group of goods and services being applied the tax rate of 10%".
2. VAT reduction
In the draft Resolution VAT reduction clearly stated, a new value-added tax of 8% will be applied to groups of goods and services currently applying the 10% tax rate.
Particularly, business establishments that are calculating VAT according to the percentage method of revenue, may reduce 20% of the percentage rate for VAT calculation when issuing invoices for goods and services eligible for VAT reduction.
Note: This reduction of value-added tax applies uniformly to all kinds of goods and services at import, production, processing and trading.
3. Implementation time (expected)
Since the policy was issued at the end of December 31, 2023.
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