MoF proposes to reduce by 2 VAT rate in 2023

The Ministry of Finance proposes to reduce 2% VAT in 2023 for goods and services subject to a 10% tax rate to 8%. Photo: Hoai Anh

The option 1, the Ministry proposes to reduce the 2% VAT rate for goods and services subject to a 10% tax rate to 8%.

Option 2, reducing the 2% VAT rate for goods and services subject to a 10% tax rate to 8%, except for some groups of goods and services as applied in 2022 under Resolution No. 43/2022/QH15 dated January 11, 2022, of the National Assembly on fiscal and monetary policies to support the Socio-Economic Development and Recovery Program.

The two options are implemented from the policy being issued to the end of December 31.

The Ministry of Finance also proposes that the General Department of Taxation and the General Department of Vietnam Customs review and evaluate the reduction of the 2% VAT rate under provisions of Resolution No. 43/2022/NQ-QH15 and Decree No. 15/2022/ Decree-CP dated January 28, 2022, of the Government on tax exemption and reduction policies under Resolution No. 43/2022/NQ-QH15. In addition, assessing the impact on the budget revenue under the two options and proposing a VAT reduction plan in 2023.

Earlier, as of April 6, the Government Office issued Official Dispatch No. 2317/VPCP- KTTH announcing the direction of the Prime Minister, Deputy Prime Minister Le Minh Khai, on the plan for exemption and reduction of tax, fees, and charges in 2023.

Accordingly, the Ministry of Finance must coordinate with ministries and sectors to propose a plan for exemption and reduction of tax, fees, and charges in 2023 and report to the Prime Minister before April 15, 2023.

The Government has issued the Resolution of the Government’s regular meeting in March. In the Resolution, the Government requested Ministers and heads of ministerial-level agencies, government agencies, and chairmen of the People’s Committees of provinces and centrally-run cities to effectively and comprehensively implement tasks and solutions under the Resolutions of the Party, the National Assembly, the Government, and the direction of the Prime Minister.

Units need to focus on maintaining macroeconomic stability, controlling inflation, promoting growth, and ensuring significant balances of the economy; drastically remove difficulties and obstacles for production and business; drastically and promptly follow the reality and closely coordinate in direction and administration; take advantage of time and opportunities to promote the recovery and development of industries and fields; make the best efforts to realize the set goals and tasks of socio-economic development.

The Government assigns the Ministry of Finance to assume the prime responsibility for and coordinate with ministries, sectors and localities in implementing expanded fiscal policies, supporting enterprises and people to cut costs, boost production, attract investment, and reduce output prices to control inflation.

The Ministry of Finance is assigned to submit to competent authorities before April 15 for consideration and implementation of solutions on an exemption, reduction, extension, or postponement of taxes, fees, charges, land rent and land use in 2023.

Urgently process the VAT refund for businesses; amend the Law on Corporate Income Tax to put corporate income tax incentives for small and medium enterprises into practice.

Review, monitor and evaluate the Government’s Decree No. 08/2023/ND-CP dated March 5, 2023, and promptly report to the competent authorities to remove new arising problems in the corporate bonds market.

Research and urgently propose amendments and supplements to the financial autonomy mechanism of public service delivery units; collaborate with ministries and agencies to perfect mechanisms, policies and laws to promote the autonomy of public service delivery units and socialize public services in eligible fields.