Vietnam: When does Appendix 142 regarding tax reduction apply until?

When does Appendix 142 regarding tax reduction apply until?

Appendix 142 on tax reduction is the Appendix for the reduction of Value Added Tax (VAT) as stated in Resolution 142/2024/QH15.

The duration for VAT reduction is stipulated in Article 2 of Decree 72/2024/ND-CP as follows:

Effectiveness and Implementation

1. This Decree comes into effect from July 1, 2024, until the end of December 31, 2024.

2. Ministries, according to their functions and duties, and the People's Committees of provinces and central-affiliated cities, shall direct relevant agencies to implement, guide, inspect, and monitor to ensure that consumers understand and benefit from the VAT reduction stipulated in Article 1 of this Decree. This includes focusing on stability solutions for the supply and demand of goods and services subject to VAT reduction to maintain market price stability (prices excluding VAT) from July 1, 2024, until the end of December 31, 2024.

The period for VAT reduction is from July 1, 2024, until the end of December 31, 2024.

This also means that Appendix 142 on tax reduction on HTKK applies from July 1, 2024, until the end of December 31, 2024.

After this period, subjects eligible for VAT reduction will return to the old tax rate as per Value Added Tax Law 2008 unless directed otherwise by a subsequent document.

Vietnam: When does Appendix 142 on tax reduction apply? (Image from the Internet)

What is the deadline for declaring VAT on a quarterly basis in Vietnam?

Based on Clauses 1 and 3, Article 44 of Tax Administration Law 2019 stipulates:

Deadline for filing tax returns

1. The deadline for filing tax returns for taxes declared monthly or quarterly is specified as follows:

a) No later than the 20th of the month following the month the tax obligation arises for monthly declaration and submission;

b) No later than the last day of the first month of the quarter following the quarter the tax obligation arises for quarterly declaration and submission.

...

3. The deadline for filing tax returns for taxes declared and submitted for each occurrence of tax obligation is no later than the 10th day from the date the tax obligation arises.

...

Therefore, for VAT declared monthly, the last day for declaring VAT is the 20th of the month following the month the tax obligation arises, meaning the 20th of every month.

What are the current VAT rates in Vietnam?

Based on Article 8 of Value Added Tax Law 2008 (amended by Clause 3, Article 1 of the Amended Value Added Tax Law 2013, Article 1 of the Amended Law on Value Added Tax, Special Consumption Tax, and Tax Administration 2016, Article 3 of the Amended Laws on Tax 2014) and Decree 72/2024/ND-CP stipulating the following VAT rates:

(1) The 0% rate applies to exported goods and services, international transportation, and goods and services not subject to VAT as specified in Article 5 of the Value Added Tax Law 2008 when exported, except for the following cases:

- Technology transfer, intellectual property transfer abroad.

- Reinsurance services abroad;

- Credit granting services;

- Capital transfer;

- Derivative financial services;

- Postal and telecommunication services;

- Exported products as specified in Clause 23, Article 5 of the Value Added Tax Law 2008.

Exported goods and services are those consumed outside Vietnam, in non-tariff zones, and goods and services provided to foreign customers as per the regulations of the Government of Vietnam.

(2) The 5% rate applies to the following goods and services:

- Clean water for production and living;

- Ores for fertilizer production; pesticides and growth stimulants for animals and plants;

- Excavation and dredging services for canals, ditches, ponds for agricultural production; farming, care, pest control for plants; preliminary processing and preservation of agricultural products;

- Cultivation, animal husbandry, and aquaculture products not yet processed, except for the products specified in Clause 1, Article 5 of this Law;

- Processed rubber latex; processed turpentine; nets, ropes, and fibers for knitting fishing nets;

- Fresh food; unprocessed forestry products, except for wood, bamboo shoots and products specified in Clause 1, Article 5 of the Value Added Tax Law 2008;

- Sugar; by-products of sugar production, including molasses, bagasse, and mud residue;

- Products made of jute, rush, bamboo, rattan, coconut husk, coconut shell, water hyacinth, and other handicraft products made from agricultural materials; processed cotton; newsprint;

- Medical equipment and instruments, medical gauze, and cotton; disease prevention and treatment drugs; pharmaceutical products and medicinal herbs for producing disease prevention and treatment drugs;

- Educational tools for teaching and learning, including models, drawings, boards, chalk, rulers, compasses, and specialized tools and equipment for teaching, research, and scientific experiments;

- Cultural activities, exhibitions, sports, and performances; film production, import, distribution, and screening;

- Children's toys; all kinds of books except those specified in Clause 15, Article 5 of the Value Added Tax Law 2008;

- Scientific and technological services according to the Law on Science and Technology.

- Sale, lease, and lease-purchase of social housing in accordance with the Housing Law

(3) The 8% rate applies to certain goods and services with reduced VAT (from 10% to 8%) under Decree 72/2024/ND-CP.

(4) The 10% rate applies to goods and services not subject to the 0%, 5%, or 8% rates.

Therefore, depending on the taxable entities, from July 1, 2024, VAT rates applicable shall be 0%, 5%, 10%, or 8%.