The Ministry of Finance is seeking comments on the draft Decree regulating the policy of reducing value-added tax by 2% in the last 6 months of 2024 according to the National Assembly Resolution.
The Ministry of Finance said that the issuance of the Decree aims to stimulate consumption, in line with the current economic context, thereby promoting production and business activities to recover and develop soon to contribute back to the State budget as well as the economy to implement the 5-year Socio-Economic Development Plan 2021 - 2025, the Annual Socio-Economic Development Plan, and the Economic Restructuring Plan for the period 2021 - 2025.
Support about 19,488 trillion VND through VAT reduction in the first 5 months of 2024
The Ministry of Finance said that in 2024, the 2% VAT reduction under Resolution No. 110/2023/QH15 in the first 5 months of 2024 has supported businesses and people with about 19,488 trillion VND. Except for February, which has the Tet holiday, the average VAT reduction in the remaining months at the import stage is about 1.5 trillion VND/month and the domestic stage is expected to be about 2.5 trillion VND/month.
According to information on recent socio-economic developments in the Statistical Report on the socio-economic situation in the first 5 months of 2024 of the Ministry of Planning and Investment, many positive points were shown: The GDP growth rate in the first quarter of 2024 is estimated to increase by 5.66% over the same period last year, higher than the growth rate of the first quarter of the years 2020-2023; In the first 5 months of the year, the total import and export turnover of goods reached 305.53 billion USD, an increase of 16.6% over the same period last year, of which exports increased by 15.2%, imports increased by 18.2%, the trade balance of goods had a surplus of 8.01 billion USD. The consumer price index (CPI) in the first 5 months of 2024 increased by 4.03% over the same period last year; core inflation increased by 2.78%; Comparing the number of newly registered and resuming businesses with the number of businesses withdrawing from the market, the total number of businesses increased by 1,500 businesses, an average increase of 300 businesses per month; total retail sales of goods and consumer service revenue in the first 5 months of 2024 increased by 8.7% over the same period last year. According to the report of the State Treasury, the state budget revenue as of May 31, 2024 was 909.3 trillion VND, equal to 53.5% of the estimate and an increase of 15% over the same period in 2023.
From the above results, it can be assessed that the 2% VAT reduction policy has contributed to reducing costs through businesses with production and trading activities of goods and services receiving VAT reduction, leading to a reduction in the selling price of goods and services for consumers, thereby promoting business production and business, people's consumption, contributing to creating more jobs for workers and achieving the set goal when building the VAT reduction policy, which is to stimulate consumption and promote production and business development.
Proposal to reduce value added tax by 2% in the last 6 months of 2024
According to the draft, value added tax will be reduced for groups of goods and services currently subject to a tax rate of 10%, except for the following groups of goods and services:
a) Telecommunications, financial activities, banking, securities, insurance, real estate business, metals and prefabricated metal products, mining products (excluding coal mining), coke, refined petroleum, chemical products. Details are in Appendix I issued with this Decree.
b) Goods and services subject to special consumption tax. Details are in Appendix II issued with this Decree.
c) Information technology according to the law on information technology. Details are in Appendix III issued with this Decree.
d) The reduction of value added tax for each type of goods and services prescribed shall be applied uniformly at the stages of import, production, processing, and commercial business. For coal products sold (including coal mined and then screened and classified according to a closed process before being sold) are subject to value added tax reduction. Coal products listed in Appendix I issued with this Decree, at stages other than the mining and selling stage, are not subject to value added tax reduction.
Corporations and economic groups that implement a closed process to sell are also subject to value-added tax reduction on coal products sold.
In case the goods and services listed in Appendices I, II and III issued with this Decree are not subject to value added tax or are subject to 5% value added tax according to the provisions of the Law on Value Added Tax, the provisions of the Law on Value Added Tax shall apply and no value added tax reduction shall be allowed.
The value added tax reduction rate is as follows: Business establishments calculating value added tax according to the deduction method are subject to a value added tax rate of 8% for specified goods and services.
This Decree takes effect from July 1, 2024 to December 31, 2024.
The Ministry of Finance said that if the policy of reducing VAT by 2% in the last 6 months of 2024 according to the Resolution of the National Assembly is implemented, the expected reduction in state budget revenue will be about 24 trillion VND (about 4 trillion VND/month, of which the reduction in domestic revenue is expected to be 2.5 trillion VND/month and the reduction in import revenue is about 1.5 trillion VND/month).
Source: https://www.nguoiduatin.vn/de-xuat-giam-thue-gia-tri-gia-tang-2-trong-6-thang-cuoi-nam-2024-a669303.html
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