ANTD.VN - The Ministry of Finance has just announced to collect opinions on the proposal to build a National Assembly Resolution project on reducing value added tax (VAT).
Accordingly, it is expected that the Resolution will adjust to reduce 2% VAT as currently prescribed in Resolution No. 43/2022/QH15 and Resolution No. 101/2023/QH15.
Specifically, VAT will be reduced by 2% for groups of goods and services currently subject to a tax rate of 10%, except for the following groups of goods and services: Telecommunications, information technology, financial activities, banking, securities, insurance, real estate business, metal production and production of prefabricated metal products, mining industry (excluding coal mining), coke production, refined petroleum, production of chemicals and chemical products, goods and services subject to special consumption tax.
The Ministry of Finance proposed to assign the National Assembly Standing Committee (NASC) to consider and decide on continuing to reduce VAT after June 30, 2024 if the economic situation and businesses and people are still facing difficulties, and report to the National Assembly at the nearest session.
At the same time, the Government is assigned to guide and organize the implementation of this policy to ensure transparency and effectiveness.
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The Ministry of Finance recommends continuing to apply the current policy of reducing value added tax. |
Regarding the issue of reducing VAT, some comments on the draft Resolution suggest applying it on a wider scale. For example, VCCI proposed reducing VAT by 2% for all goods and services currently subject to a VAT rate of 10%. Or the Vietnam Banking Association proposed applying the policy to credit institutions to contribute to reducing interest rates, supporting people and businesses, etc.
Regarding this issue, the Ministry of Finance said that with the first option, reducing the VAT rate by 2% for groups of goods and services as currently applied, the expected reduction in state budget revenue is about 4,175 trillion VND/month, if applied in the first 6 months of 2024, it is equivalent to about 25 trillion VND.
The second option is to reduce the VAT rate by 2% for all goods and services subject to the 10% tax rate (to 8%); reduce the % rate for calculating VAT by 20% for business establishments (including business households and individual businesses) when issuing invoices for all goods and services subject to the 10% VAT rate.
This option will help reduce tax compliance costs for taxpayers and tax administration costs for tax authorities. However, it is expected that state budget revenue will decrease by about VND 6.18 trillion/month. If applied in the first 6 months of the year, it will be equivalent to a budget revenue reduction of about VND 37.1 trillion.
Therefore, the Ministry of Finance recommends implementing the first option to suit the balance and support capacity of the State budget as well as the current socio-economic context.
To overcome and compensate for short-term impacts on state budget revenue as well as ensure proactive management of state budget estimates, the Ministry of Finance will coordinate with relevant ministries, branches and localities to focus on directing the effective implementation and deployment of tax laws; continue to reform and modernize the tax system, simplify tax administrative procedures;
At the same time, resolutely manage state budget revenue, focus on timely and effective implementation of groups of solutions for revenue management, prevention of revenue loss, transfer pricing, and tax evasion; in management, both the central budget and local budgets must continue to review and cut unnecessary expenditures (including development investment and regular expenditures) to ensure budget balance, not causing an increase in budget deficit compared to the level decided by the National Assembly.
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