The government agreed to reduce value added tax from 10% to 8%.

On April 17, the Government Office sent a document to the Minister of Finance conveying Deputy Prime Minister Le Minh Khai's opinion on tax, fee, and charge exemption and reduction plans for 2023.

Regarding the continued implementation of value-added tax reduction, Deputy Prime Minister Le Minh Khai agreed 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 value-added tax reduction according to simplified procedures.

In 2022, value added tax will also decrease from 10% to 8%. Photo: L.Bang

The Deputy Prime Minister requested the Ministry of Finance to coordinate with the Ministry of Justice and relevant ministries and agencies to develop a dossier to submit to competent authorities to ensure compliance with the process, order and procedures prescribed by the Law on Promulgation of Legal Documents. This clearly states the basis, basis and necessity to propose the development and promulgation of a draft resolution according to the shortened order and procedures, and report to the Government before April 25.

In a document sent to the Prime Minister, the Ministry of Finance proposed a 2% reduction in the VAT rate for all goods and services subject to a 10% tax rate (to 8%); a 20% reduction in the percentage rate for calculating VAT for business establishments (including business households and individual businesses) when issuing invoices for all goods and services subject to a 10% VAT rate.

The policy will be applied from the date of its issuance until December 31, 2023. The estimated reduction in state budget revenue is about VND 5,800 billion/month, and if applied in the last 6 months of the year, it will be equivalent to about VND 35,000 billion.

Regarding the continued reduction of fees and charges, the Deputy Prime Minister requested the Ministry of Finance to proactively develop documents regulating the reduction of fees and charges in accordance with the provisions of the Law on Promulgation of Legal Documents, including reporting to the Prime Minister for decision on the application of simplified procedures for circulars of the Ministry of Finance.

Proposal to reduce VAT by 2% until the end of 2023 Many associations propose to reduce VAT by 2% until the end of 2023. The associations believe that extending the 2% VAT reduction policy will help businesses have the opportunity to recover production and business.

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