When shall the Law on Amendments to Law on Value-Added Tax 2024 be promulgated in Vietnam?
When shall the Law on Amendments to Law on Value-Added Tax 2024 be promulgated in Vietnam?
On December 18, 2023, the Standing Committee of the National Assembly issued Resolution 41/2023/UBTVQH15 concerning adjustments to the 2024 legislative program, in which the Law on Amendments to Law on Value-Added Tax is among the laws to be passed at the 8th session of the 15th National Assembly.
In the afternoon of November 26, 2024, following the agenda of the 8th session, the National Assembly proceeded to vote with a majority of representatives in favor. The National Assembly voted to pass the Law on Amendments to Law on Value-Added Tax.
Based on the provisions in Clause 1, Article 80 of the Law on Promulgation of Legal Documents 2015, it is regulated that:
Publication of laws, ordinances, resolutions
- The President announces a law, ordinance no later than 15 days from the date the law, ordinance is passed.
For an ordinance passed by the Standing Committee of the National Assembly that the President requests the Standing Committee to reconsider per Clause 1, Article 88 of the Constitution, it must be sent to the Standing Committee by the President within 10 days from the date the ordinance is passed, requesting reconsideration. The Standing Committee has the responsibility to reconsider issues raised by the President at the nearest meeting. After the ordinance is re-voted and passed by the Standing Committee, the President must announce it within 15 days from the date it is passed again by the Standing Committee. If the President still disagrees, the President will present it to the National Assembly for a decision at the nearest session.
For laws, ordinances built and promulgated under a simplified procedure, the President announces such laws, ordinances no later than 05 days from the date they are passed.
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According to the above regulation, the President must announce the law no later than 15 days from the date the law is passed.
Thus, the expected date for the full promulgation of the Law on Amendments to Law on Value-Added Tax 2024 is December 11, 2024.
When shall the Law on Amendments to Law on Value-Added Tax 2024 be promulgated in Vietnam? (Image from Internet)
What are amendments to the Law on Amendments to Law on Value-Added Tax 2024 compared to the current Law on Value-Added Tax of Vietnam?
Based on Draft No. 5 of the Value-Added Tax Law 2024 (latest draft) ...Download, there are several notable changes:
(1) Adjustments to the provisions regarding subjects not subject to VAT in Article 5 of the Value-Added Tax Law 2008 (amended by Clause 1, Article 3 of the Amending Law on Tax Laws 2014) and Clause 1, Article 1 of Law No. 106/2016/QH13) as follows:
- Some subjects not subject to VAT compared to current regulations are omitted, including:
Fertilizers; machinery, equipment specialized for agricultural production; offshore fishing vessels;
Securities custody; market organization services of the stock exchange or securities trading center; other securities trading activities...
- Exported products that are natural resources, minerals, processed into other products not subject to VAT must adhere to the list prescribed by the Government of Vietnam.
Currently, exported products are goods processed from resources, minerals where the total value of resources, minerals plus energy costs accounts for 51% or more of the product cost fall under non-VAT subjects.
Additionally, goods imported for donation, aid for disaster, epidemic, war prevention and control as prescribed by the Government of Vietnam are also added to subjects not subject to VAT.
(2) Article 14 of the VAT Law draft has also added the following case for VAT refund:
Business establishments that only manufacture goods, provide services subject to a 5% VAT rate with an input VAT amount not yet fully deducted from 300 million VND or more after 12 months or 04 quarters are entitled to a VAT refund.
(3) Moreover, the VAT Law draft also:
- Amends regulations on tax calculation prices for imported goods
- Adjusts tax rates for some goods, services
Draft No. 5 of the Amended Value-Added Tax Law 2024 (latest draft) ...Download
Which cases are exempt from VAT declaration and payment in Vietnam?
Based on Clause 3, Article 2 of Decree 209/2013/ND-CP which regulates the cases exempt from declaring, calculating value added tax payment include:
- Organizations, individuals receiving compensation, bonuses, support funds, transfer of emission rights and other financial revenues.
- Organizations, individuals producing, doing business in Vietnam buying services of overseas organizations without a permanent establishment in Vietnam, individuals abroad who are non-residents in Vietnam, including cases such as: Repair of means of transport, machinery, equipment (including supplies, replacement parts); advertising, marketing; investment promotion and trade; brokerage in selling goods, service provision; training; sharing international postal, telecommunications service fees between Vietnam and abroad when these services are performed outside Vietnam.
- Organizations, individuals not doing business, not VAT payers selling assets.
- Organizations, individuals transferring investment projects to produce, do business in goods, services subject to VAT to enterprises, cooperatives.
- Agricultural, livestock, or aquaculture products not yet processed into other products or just through simple processing sold to enterprises, cooperatives, except as stipulated in Clause 1, Article 5 of the Value-Added Tax Law 2008.
