The Government submitted to the National Assembly a proposal to further reduce VAT by 2% until mid-2024.

Authorized by the Prime Minister, Minister of Justice Le Thanh Long signed the Government's submission to the National Assembly and the National Assembly Standing Committee, proposing to add the National Assembly's Resolution on value-added tax reduction to the law and ordinance-making program in 2023.

In 2022, the National Assembly issued Resolution 43/2022 on fiscal and monetary policies to support the socio-economic recovery and development program, proposing a solution to reduce VAT by 2% for some groups of goods and services subject to 10% tax, applicable from February 1, 2022 to December 31, 2022.

The Government finds it necessary to continue reducing VAT to support businesses and people. (Illustration: Hoang Ha)

By 2023, facing economic difficulties, the National Assembly issued Resolution 101/2023 allowing the continued implementation of the VAT reduction policy, applicable from July 1 to December 31.

According to the Government, the solution to reduce value added tax along with other tax, fee and charge solutions is creating great conditions to help businesses reduce production costs, increase profits, promote production and business development, create more jobs for workers, and contribute to economic growth.

In order to promptly respond to developments in the socio-economic situation, based on consideration and calculation in accordance with actual conditions, the Government believes that it is necessary to drastically and effectively implement solutions to support taxes, fees, charges and land rents issued in 2023 and continue to study and propose solutions for 2024.

Specifically, continue to consider reducing VAT by 2%, consider reducing environmental protection tax on gasoline and oil as applied in 2023; continue to review and reduce export tax and import tax rates to support domestic production and business; reduce collection of some fees and charges.

From the results achieved by the 2% VAT reduction solution, the Government finds it necessary to continue implementing VAT reduction in the first 6 months of 2024 to support businesses and people.

The Government proposes to reduce VAT by 2% for a number of groups of goods and services currently subject to a 10% VAT rate; assign the National Assembly Standing Committee to consider and decide on continuing to reduce VAT after June 30, 2024.

The Government also proposed that the National Assembly Standing Committee consider and report to the National Assembly for permission to add the National Assembly's Resolution on VAT reduction to the 2023 law and ordinance making program, draft the resolution according to the simplified order and procedures, and submit it to the National Assembly for approval at the 6th session according to the one-session process.

Regarding the proposal to reduce VAT by 2%, in the explanation of the socio-economic discussion session on November 2, Minister of Finance Ho Duc Phoc said that according to Resolution 43, some industries are not allowed to reduce, such as finance, telecommunications, securities, banking, etc.

"Obviously, if the reduction is too much, it will put pressure on the budget," Mr. Phuc emphasized.

(Source: Vietnamnet)

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