Value-added tax (VAT) is a tax charged on the added value of goods and services arising in the process from production, circulation to consumption. However, not all goods and services are subject to VAT. So according to the current law, there are objects that are not subject to VAT?
Article table of contents
Who is not subject to value added tax? (Illustration)
Pursuant to Article 5 of the Law on Value Added Tax 2008 (amended in 2013, 2014, 2016), the objects not subject to VAT include:
1. Products of cultivation, husbandry and aquaculture, which have not been processed into other products or have only undergone normal preliminary processing, are sold and sold by the organizations or individuals themselves and at the stage of import. password.
Enterprises and cooperatives that purchase crop, livestock, and aquaculture products that have not yet been processed into other products or are only preliminarily processed and sold to other enterprises or cooperatives are not required to list them. declare, calculate and pay value-added tax but receive input value-added tax deduction.
2. Products are livestock breeds, plant varieties, including breeding eggs, breeding animals, seedlings, seeds, semen, embryos and genetic materials.
3. Irrigation and drainage; plow and harrow the land; dredging canals and ditches in the field to serve agricultural production; agricultural product harvesting services.
4. Salt products are produced from sea water, natural rock salt, refined salt, and iodized salt whose main ingredient is sodium chloride (NaCl).
5. State-owned houses sold by the State to tenants.
6. Transfer of land use rights.
7. Life insurance, health insurance, learner insurance, other insurance services related to people; livestock insurance, crop insurance, other agricultural insurance services; insurance for ships, boats, equipment and other necessary tools in direct service of fishing; reinsurance.
8. The following financial, banking and securities trading services:
- Credit granting services include: lending; discount, rediscount negotiable instruments and other valuable papers; guarantee; financial leasing; credit card issuance; domestic factoring; international factoring; other forms of credit extension as prescribed by law;
- Lending services of taxpayers who are not credit institutions;
- Securities trading includes: securities brokerage; securities trading; underwriting securities; securities investment consulting; securities depository; securities investment fund management; securities portfolio management; market organization services of the stock exchange or securities trading center; other securities business activities in accordance with the law on securities;
- Capital transfer includes: transferring part or all of the invested capital, including the case of selling the enterprise to another enterprise for production, business or securities transfer; other forms of capital transfer as prescribed by law;
- Selling debt;
- Foreign currency trading;
- Derivative financial services including: interest rate swaps; forward contracts; futures contract; the right to buy and sell foreign currencies; other derivative financial services as prescribed by law;
- Sale of collateral for debts of organizations in which the State owns 100% of charter capital, established by the Government to handle bad debts of Vietnamese credit institutions.
9. Medical and veterinary services, including medical examination, treatment and prevention services for humans and animals; care services for the elderly and people with disabilities.
10. Universal postal and telecommunications services and Internet according to the Government's program.
11. Services to maintain zoos, flower gardens, parks, street trees, public lighting; funeral service
12. To maintain, repair and build with the people's contributions and humanitarian aid capital for cultural and artistic works, public service works, infrastructure and housing for children. social policy object.
13. Teaching and vocational training as prescribed by law.
14. Radio and television broadcasting with state budget capital.
15. Publishing, importing and distributing newspapers, magazines, specialized bulletins, political books, textbooks, textbooks, legal documents, scientific and technical books, books printed in ethnic script minorities and propaganda pictures, posters, even in the form of tapes or discs with audio, video or electronic data; money, print money.
16. Public transport of passengers by bus or tram.
17. Machinery, equipment, spare parts and supplies that cannot be produced at home and need to be imported for direct use in scientific research and technological development; machinery, equipment, spare parts, special-use means of transport and materials that cannot be produced at home and need to be imported to conduct prospecting, exploration and development of oil and gas fields; Aircraft, drilling rigs, ships which cannot be produced at home and need to be imported to create fixed assets of enterprises or leased from abroad for use in production, business, lease or sublease.
18. Weapons and equipment used exclusively for national defense and security.
19. Goods imported in the case of humanitarian aid or non-refundable aid;
Gifts for state agencies, political organizations, socio-political organizations, socio-political-professional organizations, social organizations, socio-professional organizations, people's armed forces units ; gifts and gifts for individuals in Vietnam according to the levels prescribed by the Government;
Items of foreign organizations and individuals according to diplomatic immunity standards; carry-on items in the duty-free baggage allowance.
Goods and services sold to foreign organizations and individuals, international organizations for humanitarian aid and non-refundable aid to Vietnam.
20. Goods transshipped or transited through the Vietnamese territory;
Goods temporarily imported for re-export; goods temporarily exported or re-imported;
Raw materials imported for production or processing of goods for export under production contracts; export processing signed with foreign parties; goods and services are traded between foreign countries and non-tariff zones and between non-tariff zones.
21. Technology transfer in accordance with the Law on Technology Transfer; transfer intellectual property rights in accordance with the Law on Intellectual Property; software.
22. Imported gold in bars and pieces that have not been processed into fine art products, jewelry or other products.
23. Exported products are exploited natural resources and minerals that have not been processed into other products.
24. Artificial products used to replace the patient's body parts; crutches, wheelchairs and other specialized equipment for the disabled.
25. Goods and services of business households and individuals with an annual turnover of one hundred million dong or less.
Note: Establishments trading in goods and services that are not subject to value-added tax mentioned above are not entitled to deduction and refund of input value-added tax, except for the case of applying the 0% tax rate specified in Clause 1. Article 8 of the Law on Value Added Tax .
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