Which salt products are not subject to VAT in Vietnam?

Which salt products are not subject to VAT in Vietnam?

According to Clause 4, Article 5 of the Value-Added Tax Law 2008 (as amended by Clause 1, Article 1 of the Law on Amendments to Value-Added Tax Law 2013):

Non-taxable objects

1. Cultivation and husbandry products, and reared and fished aquatic products which have not yet been processed into other products or have been just preliminarily processed and sold by producing and fishing organizations and individuals, and products at the stage of importation.

2. Products which are animal breeds and plant varieties, including breeding eggs, breeding animals, seedlings, seeds, sperms, embryos and genetic materials.

3. Irrigation and drainage; soil ploughing and harrowing; dredging of intra-field canals and ditches for agricultural production; services of harvesting farm produce.

4. Salt products made of seawater, natural rock salt, refined salt, iodized salt of which the primary constituent is sodium chloride (NaCl).

5. State-owned residential houses sold by the State to current tenants.

6. Transfer of land use rights;

...

Thus, salt products made of seawater, natural rock salt, refined salt, iodized salt of which the primary constituent is sodium chloride (NaCl) are not subject to VAT in Vietnam.

Which salt products are not subject to VAT in Vietnam? (Image from the Internet)

In cases where the salt product is subject to VAT in Vietnam, which entity is the taxpayer?

According to Article 4 of the Value-Added Tax Law 2008:

Taxpayers

Taxpayers include organizations and individuals producing or trading in goods or services subject to value-added tax (below referred to as business establishments) and organizations and individuals importing goods subject to value-added tax (below referred to as importers).

Thus, if the salt product is subject to VAT, the organizations and individuals producing, trading, or importing the salt are the taxpayers.

What are the places to pay VAT in Vietnam?

According to Article 20 of Circular 219/2013/TT-BTC, the specific places to pay VAT in Vietnam are stipulated as follows:

- Taxpayer shall declare and pay VAT in the locality where the business is situated.

- If the taxpayer that pays VAT using credit-invoice method has a financially dependent manufacturing facility in a province other than the province where the headquarter is situated, VAT shall be paid in both provinces.

- If a company or cooperative that uses direct method has a manufacturing facility in a province other than that where the headquarter is situated, or engages in extraprovincial sale, the company or cooperative shall pay direct VAT on the revenue earned from extraprovincial sale in the province where the sale is made. The company or cooperative is not required to pay direct VAT on such revenue, which has been declared at paid, at the headquarter

- When a provider of telecommunications services provides postpaid telecommunications services in a province other than the province where their headquarter is situated, and establish a financially dependent branch that pays VAT using credit-invoice method and also provides postpaid telecommunications services in that same province, the provider of telecommunications services shall declare and pay VAT on postpaid telecommunications services as follows:

+ VAT on the total revenue from provision of postpaid telecommunications services of the provide shall be declared at the supervisory tax authority of the headquarter.

+ VAT shall be paid in the provinces where the headquarter and the branch are situated.

Direct VAT shall be paid at 2% of the revenue from telecommunications services provided in the province where the branch is situated (postpaid telecommunications services are subject to 10% tax)

- VAT shall be declared and paid in accordance with the Tax Administration Law 2019 and its guiding documents