On December 31, 2024, the Government issued Decree No. 180/2024/ND-CP, extending the value-added tax (VAT) reduction policy for the first six months of 2025.
The General Department of Customs also released Official Letter No. 6068/TCHQ-TXNK, providing guidance on implementing this policy.
Key points to note:
1. Subjects eligible for VAT reduction and VAT reduction rates:
Eligible Subjects: Goods and services currently subject to the 10% VAT rate.
Tax reduction:
- For taxpayers using the credit-invoice method: A 2% reduction (applying an 8% VAT rate).
- Tax calculation according to the revenue percentage method: 20% reduction in the VAT calculation rate if invoices are issued.
(Pursuant to Articles 1 and 1.2 of Decree 180/2024/ND-CP)
2. Groups of goods and services not eligible for VAT reduction:
Group of goods and services belonging to groups – Details: Appendix I
- Telecommunications, finance, banking, securities, insurance, real estate.
- Metal, prefabricated metal products.
- Mining products (except coal mining), coke, refined petroleum, chemicals.
Group of goods and services in information technology – Details: Appendix III
Group of goods and services subject to special tax – Details: Appendix II
Goods and services are not subject to the VAT rate of 10%.
Coal products: only VAT reduction at the coal mining stage.
(Pursuant to Article 1.1 of Decree 180/2024/ND-CP)
3. Instructions for declaration on the VNACCS/VCIS system:
Use code VB235 in the “Codes for application of tax rates/tax rates and other collections” on the e-import declaration to declare the VAT rate of 8%.
The use of the code applies from 0:00 on January 1, 2025 for goods subject to VAT reduction.
The VB235 code does not apply to:
- Goods are not subject to VAT.
- Goods subject to VAT at the rate of 0% or 5%.
- Goods are not subject to VAT reduction according to Resolution 174/2024/QH15.
The VAT reduction is consistently applied across all stages, including importation, production, processing, and commercial business, effective January 1, 2025.
(According to Decree 180/2024/ND-CP and Official Letter No. 6068/TCHQ-TXNK)
Relevant articles:
Taxes on Imported Goods: Definition and Categories
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