General Department of Taxation's Guidance on Value Added Tax Reduction for Electronic Consumer Products
When is the determination of VAT for the sale of household electronic products?
Based on the provisions of Article 8 Circular 219/2013/TT-BTC on the time of determining VAT as follows:
Determination of VAT
1. For the sale of goods, it is the time of transfer of ownership or right to use the goods to the buyer, regardless of whether money has been collected or not.
2. For the provision of services, it is the time when the service provision is completed or the time of issuing the service provision invoice, regardless of whether money has been collected or not.
For telecommunications services, it is the time of completing the data reconciliation of telecommunications service charges under the economic contract between telecommunications service business establishments, but no later than 2 months from the month in which the telecommunications service charges arise.
3. For the supply of electricity and clean water, it is the date of recording the consumption index on the meter for billing.
4. For real estate business activities, infrastructure construction, house construction for sale, transfer or rental, it is the time of receiving payments according to the project implementation schedule or the payment schedule stated in the contract. Based on the amount received, the business establishment shall declare the VAT on output arising in the period.
5. For construction and installation, including shipbuilding, it is the time of acceptance and handover of the project, project item, completed construction and installation volume, regardless of whether money has been collected or not.
6. For imported goods, it is the time of registering the customs declaration.
Thus, according to regulations, the time of determining VAT for the sale of household electronic products is the time of transferring ownership or right to use the goods to the buyer, regardless of whether money has been collected or not.
General Department of Taxation's guidance on VAT reduction for household electronic products (Image from the Internet)
Are household electronic products eligible for VAT reduction?
According to Point c Clause 1 Article 1 Decree 15/2022/ND-CP on VAT reduction as follows:
VAT reduction
1. A VAT reduction applies to groups of goods and services that are currently subject to a VAT rate of 10%, except for the following groups of goods and services:
...
c) Information technology under the law on information technology. Details are provided in Appendix III attached to this Decree.
In Section III Part B Appendix III attached to Decree 15/2022/ND-CP, the group of household electronic equipment products includes: Refrigerators and Coolers, washing machines, microwave ovens, vacuum cleaners, air conditioners, dehumidifiers, and other types.
At the same time, based on the provisions of Clause 14 Article 3 Decree 71/2007/ND-CP as follows:
Definitions
In this Decree, the following terms are understood as follows:
...
14. Household electronic devices are electronics used in household activities. Household electronic devices include air conditioners, refrigerators, washing machines, vacuum cleaners, and microwave ovens.
Thus, according to regulations, household electronic products are not eligible for VAT reduction.
Guidance on VAT reduction for the provision of goods and services with specific invoice issuance times
According to Point a Clause 4 Article 9 Circular 219/2013/TT-BTC on the time of invoicing as follows:
Time of invoicing
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The time of invoicing for specific cases is as follows:
a) For cases of providing services with a large quantity, occurring frequently, requiring data reconciliation time between the service provider and the customer, partner such as direct support services for air transport, aviation fuel supply services for airlines, the provision of electricity (except for the subjects specified at Point h of this Clause), water, television services, postal services, and delivery (including agency services, collection, and payment services), telecommunications services (including value-added telecommunications services), logistics services, and information technology services (except for the cases specified at Point b of this Clause) sold on a periodic basis, the time of invoicing is the time of completing data reconciliation between the parties, but no later than the 07th day of the following month in which the service provision occurs or no later than 07 days from the end of the agreed period. The agreed period is the basis for calculating the quantity of goods and services provided based on the agreement between the seller and the buyer.
In Official Dispatch 3522/TCT-CS 2022, the General Department of Taxation provides guidance as follows:
For the provision of goods and services with specific invoice issuance times stipulated in Clause 4 Article 9 of Decree 123/2020/ND-CP, business establishments are entitled to a VAT reduction in accordance with regulations for invoices issued from February 1, 2022, to December 31, 2022.
See detailed content of Official Dispatch 3522/TCT-CS 2022: HERE
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