The Vietnamese Government passes the proposal for draft Resolution reducing the value-added tax for last 6 months of 2024

On 28^th May 2024, the Vietnamese Government (the Government) has issued Resolution 81/ND-CP (Resolution 81) on the proposal of developing the project of the National Assembly’s Resolution to reduce the value added tax (VAT).

Following the initial proposal of the Ministry of Finance (MOF) in its Request 116/TTrTBC, the Government has assigned MOF to submit the proposal/project to the National Assembly (NA). The Resolution 81 is in the NA’s 2024 legislative Agenda allowing the development of the project as per fast-track procedure and to submit to the NA at its 7^th Session.

Specifically, the project will provide that the VAT will be reduced 2%, applicable for the goods and services of 10% VAT (reduced to 8%), excepting for the business activities such as: telecommunications, information technology, financial activities, banking, securities, insurance, real estate business, metal production and production of prefabricated metal products, mining industry (excepting mining), coal mining, production of coke, refined petroleum, production of chemicals and chemical products, goods and services subject to special consumption tax.

The MOF will coordinate with the Ministry of Justice and will provide all materials and documentation to the MOJ as per laws and report on timely manner to the NA. The application of the reduced VAT less of 2% is planned to be applicable from 1 July to 31^st December 2024.

Before the Resolution 81, the Government has been working with MOF and local authorities to research and submit before 30^th April 2024 draft regulations extending taxes (value-added tax, corporate income tax, personal income tax, special consumption tax) for the domestically produced and assembled cars, etc.) in order to reduce the registration fees for domestically these cars, reduce land and water surface rents. The Government is continuing the works with the authorities, having requested them to promptly review and issue, promulgate policies to reduce taxes, fees and charges as implemented in 2023 and to continue to remove difficulties and support production and business activities.

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