On July 4, 2023, the Ministry of Transport issued Official Dispatch 7024/BGTVT-TC implementing Decree 44/2023/ND-CP on VAT reduction policy according to Resolution 101/2023/QH15.
Ministry of Transport directs the implementation of Decree 44/2023 on reducing VAT to 8%
Accordingly, implementing Decree 44/2023/ND-CP dated June 30, 2023 on the policy of reducing VAT to 8% according to Resolution 101/2023/QH15, the Ministry of Transport requests:
- Agencies and units under the Ministry according to assigned functions and tasks:
+ Urgently research, organize consultation, and promptly implement Decree 44/2023/ND-CP (effective from July 1, 2023 to December 31, 2023).
+ Proactively organize guidance, inspection, supervision and propaganda so that consumers understand and benefit from the reduction of value-added tax prescribed in Decree 44/2023/ND-CP.
- Regarding road service prices of road construction investment projects for business purposes managed by the Ministry of Transport: Assign the Vietnam Road Administration to implement the reduction of VAT in ticket prices according to regulations.
Policy to reduce VAT to 8% according to Decree 44/2023/ND-CP
- Reduce value added tax on 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 prefabricated metal products, mining products (excluding coal mining), coke, refined petroleum, chemical products. Details in Appendix I issued with Decree 44/2023/ND-CP.
+ Goods and services subject to special consumption tax. Details in Appendix II issued with Decree 44/2023/ND-CP.
+ Information technology according to the law on information technology. Details in Appendix III issued with Decree 44/2023/ND-CP.
+ 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), they are subject to value added tax reduction. Coal products in Appendix I issued with Decree 44/2023/ND-CP, at stages other than mining and selling, are not subject to value added tax reduction.
Corporations and economic groups that implement a closed process to sell are also subject to value-added tax reduction on coal products sold.
In case the goods and services listed in Appendices I, II and III issued together with Decree 44/2023/ND-CP 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 apply and no value added tax reduction shall be granted.
- Value added tax reduction:
+ Business establishments calculating value added tax according to the deduction method shall apply a value added tax rate of 8% to the above goods and services.
+ Business establishments (including business households and individual businesses) calculating value added tax according to the percentage method on revenue are entitled to a 20% reduction in the percentage rate for calculating value added tax when issuing invoices for goods and services eligible for reduced value added tax.
Decree 44/2023/ND-CP takes effect from July 1, 2023 to December 31, 2023.
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