Are fishing vessels engaged in fishery in sea of Vietnam subject to a value added tax rate of 5% from July 1, 2025?

Are fishing vessels engaged in fishery in sea of Vietnam subject to a value added tax rate of 5% from July 1, 2025?

Pursuant to Point g Clause 2, Article 9 of the Law on Value-Added Tax 2024 (effective from July 1, 2025), specific regulations on the 5% tax rate are as follows:

Tax Rate

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2. The 5% tax rate applies to the following goods and services:

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d) Crepe rubber, sheet rubber, block rubber, and crumbs; nets, ropes, and fibers used for knitting fishing nets;

e) Products made from jute, rushes, bamboo, rattan, leaves, straw, coconut shells, coconut husks, water hyacinth, and other handicraft products produced from agricultural by-products; cotton fiber that has been carded, cleaned; newsprint;

g) Fishing vessels engaged in fishery in sea of Vietnam; specialized machinery and equipment serving agricultural production as regulated by the Government of Vietnam;

h) Medical equipment in accordance with laws on medical equipment management; preventive and curative medicines; pharmaceutical active ingredients, raw materials for the production of preventive and curative medicines;

i) Equipment used for teaching and learning including models, diagrams, boards, chalk, rulers, compasses;

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Thus, through the above regulation, fishing vessels engaged in fishery in sea of Vietnam are subject to a value added tax rate of 5% starting July 1, 2025.

Are fishing vessels engaged in fishery in sea of Vietnam subject to a value added tax rate of 5% from July 1, 2025? (Image from the Internet)

When is the time for determining VAT in Vietnam from July 1, 2025?

According to Article 8 of the Law on Value-Added Tax 2024 (effective from July 1, 2025), the specific regulations on the timeline for determining VAT are as follows:

[1] The timeline for determining value added tax is stipulated as follows:

- For goods, it is the time of transfer of ownership or the right to use goods to the buyer or the time of invoicing, regardless of whether the payment has been collected or not;

- For services, it is the time of completion of service provision or the time of invoicing for service provision, regardless of whether the payment has been collected or not.

[2] The timeline for determining value added tax for the following goods and services is regulated by the Government of Vietnam:

- Exported goods, imported goods;

- Telecommunication services;

- Insurance business services;

- Electricity supply activities, electricity production, clean water activities;

- Real estate business activities;

- Construction, installation, and oil and gas operations.

When does the Law on Value-Added Tax 2024 come into force in Vietnam?

According to Article 18 of the Law on Value-Added Tax 2024, the specific regulations on the effective date are as follows:

Effective Date

1. This Law comes into force from July 1, 2025, except for the provisions stipulated in Clause 2 of this Article.

2. The provisions on the revenue level of households, business individuals who are not subject to tax in Clause 25, Article 5, and Article 17 of this Law take effect from January 1, 2026.

3. The Law on Value-Added Tax No. 13/2008/QH12, as amended and supplemented by Law No. 31/2013/QH13, Law No. 71/2014/QH13, and Law No. 106/2016/QH13 becomes invalid since the effective date of this Law.

Thus, through the above regulation, the Law on Value-Added Tax 2024 takes effect from July 1, 2025.