Vietnam cuts VAT to 8% till year end

By VNA   July 1, 2024 | 03:00 am PT
Vietnam cuts VAT to 8% till year end
Customers shop at Con Market in Da Nang City. Photo by VnExpress/Van Dong
The Government on June 30 issued a decree regulating a reduction in value-added tax (VAT) on goods and services from July 1 to December 31, in accordance with a resolution adopted by the National Assembly on June 29.

The VAT cut to 8% from 10%, which has been put in place since 2022, is not applicable to such services and products as telecommunications, finance, banking, security, insurance, real estate business, coke and chemical products, and goods and services subject to special consumption tax.

It has been consistently applied in import, export, production and trade.

The decree also stipulates the order and procedures to carry out the tax incentive.

Also on July 1, several fees and charges will be reduced till the end of the year to remove bottlenecks for enterprises and prop up their business activities, under a circular of the Ministry of Finance.

Accordingly, a 50% decrease will be applied for fees for the establishment and operation of banks and non-bank credit institutions, the issuance of the citizen identification cards, and registration of intellectual property protection, appraisal and approval of fire prevention and fighting designs, and use of railway infrastructure, among others.

Reductions from 10-30% are applied to fees for issuing licences and permits for civil aviation operations, entry and exit permits for restricted airport areas, and customs fees for foreign flights landing in Vietnam.

Meanwhile, the securities industry sees a 50% reduction in most fees and charges, except for licensing fees of securities professionals and supervision fees for securities activities.

This marks the fourth time the ministry has imposed fee reductions of 10-50%, which is estimated to have a budgetary impact of about VND700 billion (US$29.1 million).

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