Continued 2% reduction in VAT for 6 months, people and businesses save 25,000 billion VND

According to the Ministry of Finance, extending the 2% VAT reduction period for the first 6 months of 2025 will help consumers and businesses save 25,000 billion, helping to stimulate consumption.

In Resolution 218 of the regular Government meeting in October, the Government requested the Ministry of Finance to preside over and coordinate with agencies and localities to advise and propose to issue policies according to its authority or submit to competent authorities for issuance. Exemption, reduction, extension of taxes, fees, land use fees in 2025 so that they can be implemented from the beginning of the year. Especially the continued extension of implementation VAT reduction in the first 6 months of 2025 to report to the National Assembly at the 8th Session. Assign Deputy Prime Minister Ho Duc Phoc to direct the handling and ensure the required deadline.

The Ministry of Finance has just proposed to draft a National Assembly Resolution on reducing value-added tax in the first 6 months of 2025. This is good news for consumers and businesses. Because if approved, this will be the 5th time the National Assembly and the Government have issued this policy, starting from 2022 to support people, businesses, and stimulate consumption.

2% VAT reduction help stimulate consumer demand

If the VAT rate is 10%, the order will be 125,500 VND. However, if the VAT rate of 8% is applied, it will save 2,500. This may not seem like a large number, but if calculated for all Vietnamese consumers in 2024, it will save 47,000 billion VND.

"It's too big, I'm surprised. If it's 47,000 billion VND, it's quite a big deal, it will help society a lot. If it can be reduced further, I think it would be even better," said Ms. Tran Thuy Vinh, Ba Dinh District, Hanoi.

As for Ms. Tuyen, every weekend she and her son go to the supermarket. On average, her family spends 5-6 million VND per month to buy essential household items. According to calculations, if VAT is reduced by 2%, a small amount of money will be saved.

"Depending on each purchase, there are months when I save 100,000 - 200,000 VND," said Ms. Quach Thi Tuyen, Ba Dinh District, Hanoi.

When applying the 2% VAT reduction, Ms. Trang said that her spending will increase and her shopping needs will also increase by 10 - 15%.

Ms. Do Thi Quynh Trang, Ba Dinh District, Hanoi City said: "In the past, I could spend about 200 - 300,000 VND/week on things like instant noodles, cakes, and breakfast milk. But now I can increase it to about 350 - 400,000 VND/week."

Many people are looking forward to it. 2% VAT reduction policy will continue to be applied in the first half of next year. Because every penny saved is worth every penny. According to the Ministry of Finance, if the period is extended for the first 6 months of 2025, consumers and businesses will save 25,000 billion VND.

Businesses expect 2% VAT reduction

The 2% VAT reduction will continue to contribute to stimulating consumer demand.

If in 2021, the 2% VAT reduction policy has not been applied, the total retail sales of goods and consumer service revenue is estimated to reach over 4 million 789,000 billion VND. In 2022, after applying the 2% tax reduction, this figure has increased to 5 million 679,000 billion VND, an increase of 19%. In 2023, it will continue to increase to 6 million 231,000 billion VND. And in the first 9 months of this year, this figure still increased by 8.8% over the same period.

The 2% VAT reduction has contributed to stimulating consumer spending. Over the past 3 years, not only consumers and businesses have benefited, but manufacturing enterprises have also received cash flow support from this policy to restore production and business. Therefore, more than anyone else, they are still looking forward to continuing to enjoy this policy in the future.

Every month, toy manufacturing enterprises have to spend more than 1 billion VND to buy plastic materials for production. The 2% VAT reduction over the past time has helped enterprises save tens of millions of VND each month. "Little by little makes a big difference", this reduction shows the spirit of sharing and accompanying the Policy with enterprises and consumers. If the reduction continues for another 6 months, it will be a driving force for enterprises to recover.

Mr. Nguyen Trung Kien - Director of An Toan Viet Toy Joint Stock Company shared: "We can accumulate basic funds so that we can invest in better production, business and sales activities."

Better sales are also expected by food manufacturers. By reducing taxes for consumers, many businesses believe it will help stimulate spending.

"In the context of decreasing consumer purchasing power and continuously increasing input materials, businesses hope that the government will maintain VAT reduction at least until the end of the second quarter of next year," said Mr. Phan Van Dung - Deputy General Director of VISSAN Company.

Mr. Tong Minh Phuong - Head of International Purchasing Management Department, EMIN Vietnam Joint Stock Company said: "With such support, when the product reaches the customer, the cost will also be reduced, thus supporting the company's customers".

Along with the policies of extending and reducing taxes and fees, the 2% VAT reduction has also contributed to the recovery of business production. This is demonstrated by the GDP growth of 6.82% in the first 9 months of this year. Despite being affected by the storm no. 3 But many industries still have impressive growth rates such as: Manufacturing industry, services, wholesale and retail still have an average growth rate of 7-9%.

Source: https://baoquangninh.vn/giam-tiep-2-thue-vat-trong-6-thang-nguoi-dan-va-doanh-nghiep-tiet-kiem-25-000-ty-dong-3330460.html