Fertilizers, agricultural machinery and fishing vessels may be subject to a 5% tax.

At the 39th session, the Standing Committee gave its opinions on a number of issues with different opinions in explaining, accepting and revising the draft Law on Value Added Tax (amended). There are still two different opinions on this draft Law. The first opinion believes that since this content has been agreed upon by the drafting agency and the reviewing agency, there is no need to ask for the opinions of National Assembly deputies. However, there are also opinions that this is an issue of concern to many deputies, so it is necessary to ask for the opinions of National Assembly deputies.

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Regarding the transfer of fertilizers from non-taxable to 5% taxable, Chairman of the Committee for Finance and Personnel Le Quang Manh said that the content of this content has been agreed by the Standing Committee of the National Assembly with the Government's proposal, transferring fertilizers, agricultural machinery and fishing vessels from non-taxable to 5% taxable as shown in the draft Law and the Acceptance Explanation Report No. 1035/BC-UBTVQH15 submitted to the National Assembly.

At the discussion session in the Hall, many delegates spoke about this content, in which the majority of opinions agreed with the draft Law and the explanation of the Standing Committee of the National Assembly and the Government , some opinions suggested keeping it as the current regulations.

The Standing Committee of the National Assembly Committee has completed the explanation, received the opinions of the National Assembly Deputies, supplemented the data and information as requested by the National Assembly Deputies, and shown in the draft Explanation and Acceptance Report. This content has been agreed by the Standing Committee of the National Assembly with the Government's proposal as shown in the draft Law of the Government. However, at the discussion session in the Hall, there were still some National Assembly Deputies who did not agree on this content, so the Standing Committee of the National Assembly Committee requested the National Assembly Standing Committee to give instructions on collecting opinions of National Assembly Deputies.

There are still two different opinions in the discussion at this session. The first opinion is that since this content has been agreed upon by the drafting agency and the reviewing agency, there is no need to ask for the opinions of the National Assembly deputies. However, there is also an opinion that this is an issue of concern to many deputies, so it is necessary to ask for the opinions of the National Assembly deputies.

Regarding the regulation that output VAT is not required to be paid but input VAT is deductible. The draft Law, after being accepted and revised, has removed the regulation that allows not to pay output VAT but input VAT to be deducted for unprocessed or semi-processed agricultural products at the commercial stage to ensure the principle of VAT that input VAT can only be deducted when the output is subject to VAT. The Government proposes to keep this content as the current regulation (that is, not having to calculate and pay output VAT but input VAT can be deducted) to reduce administrative procedures, prevent invoice fraud in VAT refunds as has been done in the past and currently the electronic invoice system has not prevented the creation of fake invoices (when there is no transaction) and the overload of tax authorities in checking and verifying VAT refunds through the stages.

In fact, this policy was issued to combat tax refund fraud when businesses switched to using self-made paper invoices, which is no longer appropriate and necessary. Furthermore, even with this regulation, recently the tax authorities still believe that there have been many cases of tax refund invoice fraud for some exported agricultural products (wood chips, cassava starch, etc.).

Up to now, businesses have switched to using electronic invoices, the Tax Authority has continuously updated invoices issued by businesses, promptly monitored the budget collection situation, improved the quality of control and implemented digitalization of administrative procedures. In particular, the draft Law has added provisions on conditions for tax refund, in which if the seller has not declared and paid taxes, the buyer will not be refunded tax on that input invoice. This new regulation ensures the validity and effectiveness of preventing invoice fraud in VAT refunds, creating a legal basis for the Tax Authority to only process tax refund dossiers when the seller has declared and paid money to the State budget. Therefore, it is unlikely that the Tax Authority will refund tax for fake invoices when there is no transaction and no input tax has been paid to the budget.

At the discussion session in the Hall, there were only 2 opinions expressed on this content, one opinion agreed with the draft Law after receiving and revising it and one opinion proposed to keep it as it is. At the meeting of the Standing Committee of the Committee for National Defense and the Drafting Agency on November 11, 2023, this content still did not reach consensus, so the Standing Committee of the Committee for National Defense proposed that the Standing Committee of the National Assembly ask for the opinions of National Assembly deputies according to 2 options.

Regarding the level of revenue from sales of goods and services not subject to VAT. The draft Law after being accepted and revised has stipulated a threshold of 200 million VND/year. The Government proposes to keep this content as in the draft Law submitted at the 7th Session, thereby assigning the authority to the Government to stipulate the threshold level of annual revenue not subject to tax to ensure timely management in accordance with reality and the changing socio-economic context.

The Government believes that raising the threshold for non-taxable revenue is contrary to the policy of encouraging business households to switch to operating under the enterprise model. The opinions of the National Assembly deputies discussed in the Hall did not propose that the Government regulate the level of revenue from the sale of goods and services not subject to VAT; some opinions proposed raising this threshold to over 200 million VND, some opinions suggested a level of over or under 300 million VND or 400 million VND for the coming years.

Regarding this issue, Mr. Le Quang Manh said that the Government's plan is not suitable because the Constitution stipulates that "state budget revenues and expenditures must be estimated and prescribed by law"; the threshold of non-taxable revenue is directly related to the rights and obligations of taxpayers (in this case, individuals and business households with low incomes in society - equivalent to a revenue of 8.3 million VND/month at the current level of 100 million VND/year). This content needs to be stipulated in the Law as it is currently. The increase to 200 million VND/year as in the draft Law (equivalent to 16.6 million VND/month) is a very low level, households with revenue below this threshold will find it difficult to switch to operating under the enterprise model.

“At the meeting of the Standing Committee of the National Assembly and the Drafting Agency on November 11, 2023, the Drafting Agency agreed on the threshold of 200 million/year and removed the regulation on adjustment according to CPI. The majority of opinions of the Standing Committee of the National Assembly also agreed with this handling plan. However, the Drafting Agency emphasized that this content needs to be consulted with the Government leaders to reach consensus,” said Mr. Le Quang Manh.

Source: https://thoibaonganhang.vn/phan-bon-may-moc-nong-nghiep-va-tau-khai-thac-thuy-san-co-the-phai-chiu-thue-5-157857.html