What are technical facility requirements for learner driver car of driver training institutions in Vietnam from January 1, 2025? Are driver training services subject to value-added tax in Vietnam?
What are technical facility requirements for learner driver car of driver training institutions in Vietnam from January 1, 2025?
Pursuant to Clause 3, Article 9 of Decree No. 160/2024/ND-CP (effective from January 1, 2025), the regulations on technical facility requirements for learner driver car at driver training institutions are as follows:
- driver training institutions must have training vehicles of the categories they are allowed to train, legally owned by the institution; vehicles must be licensed by a competent authority; if the institution provides driving test services, based on the use time for testing purposes, it is permitted to use testing vehicles for both testing and training, ensuring that the number of vehicles used for calculating training capacity does not exceed 50% of the vehicles used for practical driving instruction;
- Training vehicles must correspond to the class of driving license regulated in Clause 1, Article 57 of the Road Traffic Order and Safety Law 2024. Specifically, class B training cars include vehicles with automatic transmission (including electric cars) or manual transmission; class C1, C, D1, D2, D, BE, C1E, CE, D1E, D2E, and DE training vehicles use manual transmission;
- Trucks used as class B training vehicles must have a total design weight ranging from 2,500 kg to 3,500 kg, not exceeding 30% of the total number of training vehicles of the same class at the institution;
- Training vehicles must display two “TẬP LÁI” signs in front and at the back according to the template in Appendix 1 attached to Decree No. 160/2024/ND-CP; fitted with an auxiliary brake system ensuring effective braking, placed by the instructor's seat for practical driving instruction; equipped with systems to monitor the time and distance of practical training on the road; trucks used for training must be covered to protect against rain and sun, and have seats for students; must have a valid certificate of technical safety and environmental protection for road motor vehicles;
- Three-wheeled motorcycles used for training vehicles for disabled persons must be specially designed for disabled people and must have vehicle registration and license plates issued by a competent authority;
- Automatic transmission class B cars may be used for training vehicles for individuals with disabilities affecting the right foot or hands; such vehicles, besides meeting the requirements in points a and d, Clause 3, Article 9 of Decree No. 160/2024/ND-CP, must be configured so that the remaining limbs of the disabled person can both hold the steering wheel and easily operate turn signal levers, lights, wipers, gear stick, hand brake lever, brake pedal, and accelerator in all driving situations according to the manufacturer’s design functions or certified by a competent authority as suitable for driving safety for disabled persons.
What are technical facility requirements for learner driver car of driver training institutions in Vietnam from January 1, 2025? Are driver training services subject to value-added tax in Vietnam? (Image from the Internet)
Are driver training services subject to value-added tax in Vietnam?
According to Article 3 of the Law on Value-Added Tax 2008, the provisions regarding subjects liable to value-added tax are as follows:
Subjects Liable to Tax
Goods and services used for production, business, and consumption in Vietnam are subject to value-added tax, except for those defined in Article 5 of this Law.
Additionally, pursuant to Article 5 of the Law on Value-Added Tax 2008, supplemented by Clause 1, Article 3 of the Law Amending Tax Laws 2014 and amended by Clause 1, Article 1 of Law No. 106/2016/QH13, Clause 1, Article 1 of the Amendment to the Law on Value-Added Tax 2013, which define subjects not subject to value-added tax, driving training services are not exempt from value-added tax.
Therefore, driving training services are subject to value-added tax.
What is the value-added tax rate for driver training services in Vietnam?
According to Article 11 of Circular No. 219/2013/TT-BTC, the cases for application of a 10% value-added tax rate are specified as follows:
Tax Rate of 10%
A tax rate of 10% applies to goods and services not defined in Articles 4, 9, and 10 of this Circular.
...
Furthermore, based on the provisions of Articles 5, 9, and 10 of Circular No. 219/2013/TT-BTC, regarding subjects exempt from tax and cases applying 0% and 5% tax rates, driving training services are subject to a 10% tax rate.
Additionally, pursuant to Article 1 of Decree No. 72/2024/ND-CP, which regulates the reduction of value-added tax as follows:
Reduction of Value-Added Tax
- Reduction of value-added tax for groups of goods and services currently subject to a 10% tax rate, except the following groups of goods and services:
a) Telecommunications, financial activities, banking, securities, insurance, real estate business, metals and metal products, mineral products (excluding coal mining), coke, refined petroleum, chemical products. Details in Appendix I attached to this Decree.
b) Products and services subject to special consumption tax. Details in Appendix II attached to this Decree.
c) Information technology as per information technology law. Details in Appendix III attached to this Decree.
...
- Rate of Value-Added Tax Reduction
a) Businesses calculating value-added tax by deduction method are entitled to an 8% tax rate for goods and services stipulated in clause 1 of this Article.
...
Moreover, based on the list in Appendices 1, 2, 3 of Decree No. 72/2024/ND-CP, driving training services are not exempt from a 2% VAT reduction.
As such, driving training services will be subject to a reduced value-added tax rate of 8%.
