The Government agreed to the proposal to reduce VAT to 8% by the end of the year.

Specifically, the Government Office has just issued Document No. 2614 notifying Deputy Prime Minister Le Minh Khai's opinion on the Ministry of Finance's proposal to exempt and reduce taxes, fees, and charges for 2023.

Accordingly, the Government agrees in principle that the Ministry of Finance report to the Government to submit to the National Assembly and the National Assembly Standing Committee for consideration and permission to develop and promulgate a National Assembly Resolution on VAT reduction according to simplified procedures.

The Ministry of Finance needs to promptly coordinate with the Ministry of Justice and relevant ministries and agencies to develop a draft Resolution dossier to submit to competent authorities to ensure proper processes, procedures and formalities. The dossier must clearly state the basis, basis and necessity for proposing the development and promulgation of the draft Resolution according to the simplified procedures and formalities, and report to the Government before April 25.

Regarding the continued reduction of fees and charges, the Government assigned the Ministry of Finance to proactively draft documents on reducing fees and charges in accordance with regulations.

Chính phủ đồng ý đề xuất giảm VAT về 8% đến hết năm - 1 — The Ministry of Finance proposed to reduce VAT on all goods and services subject to the 10% tax rate to 8% (Photo: Tien Tuan).

Previously, the Ministry of Finance sent a document to the Government proposing to continue reducing VAT in 2023 to stimulate consumption, promote production and business activities to recover and develop again to contribute to the budget.

Specifically, the Ministry proposed to reduce the VAT rate by 2% for all goods and services subject to the 10% tax rate to 8%; reduce the % rate to calculate VAT for business establishments (including business households and individual businesses) by 20% when issuing invoices for all goods and services subject to the 10% VAT rate.

The expected implementation period will be calculated from the date the policy is issued until the end of this year.

Assessing the impact of this tax reduction, the Ministry of Finance said that the expected reduction in state budget revenue is about 5,800 billion VND per month, if applied in the last 6 months of the year, it is equivalent to about 35,000 billion VND.

Source