Will the 2% VAT reduction continue for the first six months of 2024 and be submitted to the National Assembly at the nearest session?
How does the Government of Vietnam evaluate the socio-economic situation in September 2023?
In Resolution 164/NQ-CP in 2023 regarding the Government's regular meeting in September 2023 and the Government's online conference with localities.
The Government agreed to evaluate the socio-economic situation in September 2023 as follows:
- In September, the global situation continued to evolve complicatedly; economic recovery was slow, growth was low, inflation remained high in many countries and regions. Crude oil and food prices tended to increase, and natural disasters, climate change caused severe consequences.
- Domestically, the economy continued to show a positive recovery trend; however, difficulties and challenges remained significant, especially the "double impact" from unfavorable external factors and internal limitations and inadequacies became clearer under difficult conditions.
Will the 2% VAT reduction continue for the first 6 months of 2024 to be submitted to the National Assembly at the nearest session?
Will the 2% VAT reduction continue for the first 6 months of 2024 to be submitted to the National Assembly at the nearest session?
In sub-item 3 of Section 2 of Resolution 164/NQ-CP in 2023, the Government assigned the Ministry of Finance to propose to the National Assembly to continue reducing VAT by 2% in the first 6 months of 2024 and assigned the National Assembly Standing Committee to consider and decide in the period between two National Assembly sessions if the economic situation and businesses remain difficult, report to the National Assembly at the nearest session, report to the Prime Minister before October 7, 2023.
Additionally, the Government assigned the Ministry of Finance to perform the following tasks:
- Urgently complete the dossier to report to the National Assembly Standing Committee to consider continuing to apply the environmental protection tax rate for gasoline, oil, and lubricants as stipulated in Resolution 30/2022/UBTVQH15 in 2024, to be submitted to the Government in October 2023.
- Focus on decisively and effectively implementing solutions to ensure that state budget revenue in 2023 meets the estimates assigned by the National Assembly, collect properly, fully, promptly, expand the revenue base, especially from e-commerce, digital platforms, and prevent tax losses, especially in catering services and nighttime economic activities.
- Manage state budget expenditures in 2023 closely according to the assigned estimate, strictly reduce regular expenditures, and unnecessary tasks.
- Continue to effectively implement policies on tax, fee, and land rent exemptions, reductions, and extensions that have been issued. For policies that expire at the end of 2023, proactively study, review, consider, promptly propose, and report to competent authorities for extension if necessary to continue removing difficulties for production, business, and people's livelihoods.
- Coordinate with the Ministry of Transport and related localities on the funding allocation from increased revenue and spending savings in 2021 for three expressway construction projects as directed by the Government in Section c, Clause 3, Section I of Resolution 144/NQ-CP on September 10, 2023, to report to the Prime Minister, and compile into the report assessing the implementation of the state budget estimates in 2023 and the state budget estimates in 2024 to submit to the National Assembly for permission to transfer funds to 2023.
- Actively cooperate with National Assembly agencies to report and explain to the National Assembly Standing Committee on the use of increased central budget revenue in 2022; urgently implement the plan after being approved by the National Assembly Standing Committee and the National Assembly.
- Urgently propose and report to the Prime Minister before October 20, 2023, on how to handle and remove obstacles when transferring the capital of Vietnam Airlines Corporation at Pacific Airlines.
- Based on the proposals of ministries, agencies, and localities on fee and charge policies to encourage people and businesses to use online public services (such as: charging zero fees or reducing 50% of fees when using online public services until the end of 2025), the Ministry of Finance will study, propose, and report to the Prime Minister in October 2023.
VAT Reduction Policy under Resolution 101/2023/QH15 and Decree 44/2023/ND-CP?
To implement Resolution 101/2023/QH15, according to Article 1 of Decree 44/2023/ND-CP, the VAT reduction for goods and services groups currently subject to the 10% tax rate, excluding the following goods and services groups:
- Telecommunications, financial activities, banking, securities, insurance, real estate trading, metals and fabricated metal products, mineral products (excluding coal mining), coke, refined petroleum, chemical products. Details in Appendix I issued with Decree 44/2023/ND-CP.
- Products and services subject to special consumption tax. Details in Appendix II issued with Decree 44/2023/ND-CP.
- Information technology according to the law on information technology. Details in Appendix III issued with Decree 44/2023/ND-CP.
- VAT reduction for each type of goods and services specified in Clause 1, Article 1 of Decree 44/2023/ND-CP applies uniformly at all stages of import, production, processing, and commercial business. For coal products mined and sold (including coal mined, screened, and classified under a closed process for sale), they are subject to VAT reduction. Coal products in Appendix I issued with Decree 44/2023/ND-CP, at stages other than mining sales, are not subject to VAT reduction.
Conglomerates and economic groups that implement closed processes for coal sales are also subject to VAT reduction for mined and sold coal products.
For goods and services specified in Appendices I, II, and III issued with Decree 44/2023/ND-CP, which are not subject to VAT or are subject to 5% VAT according to the VAT Law provisions, they follow the VAT Law provisions and are not eligible for VAT reduction.
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