Value added tax reduction from July 1, 2025 to December 31, 2026

Giảm thuế giá trị gia tăng từ 01/7/2025 đến hết 31/12/2026- Ảnh 1. — Value-added tax reduction from July 1, 2025 to December 31, 2026

Reduce the value-added tax (VAT) on groups of goods and services currently subject to a 10% tax rate.

The decree states that value-added tax will be reduced for groups of goods and services currently subject to a 10% tax rate, except for the following groups of goods and services:

a- Telecommunications, financial activities, banking, securities, insurance, real estate business, metal products, mining products (excluding coal). Details are in Appendix I attached to this Decree.

b) Goods and services subject to excise tax (excluding gasoline). Details are provided in Appendix II attached to this Decree.

The decree also clarifies that the reduction in value-added tax for each type of goods and services will be applied uniformly at the import, production, processing, and commercial trading stages.

In cases where goods and services listed in Appendices I and II attached to this Decree are exempt from value-added tax or subject to a 5% value-added tax rate as stipulated in the Value-Added Tax Law, the provisions of the Value-Added Tax Law shall apply, and no value-added tax reduction shall be granted.

Value-added tax reduction

Regarding the reduction in value-added tax, the Decree clearly states: 1- Businesses calculating value-added tax using the deduction method are entitled to apply a value-added tax rate of 8% to the goods and services specified above.

2. Business establishments (including household businesses and individual businesses) that calculate value-added tax using the percentage-based method on revenue are entitled to a 20% reduction in the percentage rate used to calculate value-added tax when issuing invoices for goods and services eligible for the aforementioned value-added tax reduction.

Sequence and procedures for implementation

For businesses specified in point 1 above, when issuing value-added tax invoices for goods and services eligible for value-added tax reduction, the value-added tax rate line should be marked "8%"; value-added tax amount; and the total amount payable by the buyer. Based on the value-added tax invoice, the business selling the goods and services declares output value-added tax, and the business purchasing the goods and services declares input value-added tax deductions based on the reduced tax amount recorded on the value-added tax invoice.

For businesses specified in point 2 above, when issuing sales invoices for goods and services eligible for value-added tax reduction, the "Total Amount" column should record the full amount of goods and services before the reduction, and the "Total Amount of Goods and Services" line should record the amount after the 20% reduction in revenue, along with a note: "Reduced... (amount) corresponding to 20% of the percentage rate for calculating value-added tax according to Resolution 204/2025/QH15".

In cases where a business establishment, as stipulated in point 1 above, sells goods or provides services subject to different tax rates, the value-added tax invoice must clearly state the tax rate for each item of goods or service.

In the case of businesses as stipulated in point 2 above, when selling goods or providing services, the sales invoice must clearly state the amount of the discount.

In cases where a business has issued an invoice and declared it at a tax rate or percentage rate for calculating value-added tax that has not been reduced as stipulated in this Decree, the seller and buyer shall process the issued invoice in accordance with the law on invoices and death certificates. Based on the processed invoice, the seller shall declare an adjustment to output tax, and the buyer shall declare an adjustment to input tax (if any).

FULL TEXT OF DECREE 174/2025/ND-CP.

Snow Letter

Source: https://baochinhphu.vn/giam-thue-gia-tri-gia-tang-tu-01-7-2025-den-het-31-12-2026-10225070118590677.htm