Circular No. 13/2009/TT-BTC dated January 22, 2009 of the Ministry of Finance guiding implementation of the reduction of value added tax applicable to a number of goods and services in which business enterprises are meeting difficulties

THE MINISTRY OF FINANCE

Circular No. 13/2009/TT-BTC of January 22, 2009, guiding the reduction of value-added tax for a number of goods and services in which enterprises face business difficulties

Pursuant to June 3, 2008 Value-Added Tax (VAT) Law No. 13/2008/QH12 and guiding legal documents;

Pursuant to November 29, 2006 Tax Administration Law No. 78/2006/QH11 and guiding legal documents;

Pursuant to the XIIth National Assembly’s Resolution No. 21/2008/QH12 on the 2009 state budget estimates;

Pursuant to the Government’s Decree No. 118/2008/ND-CP of November 27, 2008, defining the functions, tasks, powers and organizational structure of the Ministry of Finance;

Pursuant to the Prime Minister’s Decision No. 16/2009/QD-TTg of January 21, 2009, promulgating tax measures for implementing the policy to stimulate investment and consumption demands, curb economic decline and remove difficulties for enterprises;

The Ministry of Finance guides VAT reduction as follows:

Article 1. The VAT rate will be reduced by 50% for a number of goods and services liable to the 10% tax rate under Point 3, Section II, Part B of Circular No. 129/2008/TT-BTC of December 26, 2008, as specified below:

1. Coal, slack, coke, peat and caked coal;

2. Base chemicals, including chemicals on the List (in the Appendix to this Circular, not printed herein).

3. Mechanical products which are production supplies (except consumer mechanical products), including:

a/ Machinery and equipment, such as engines, mills, lathes, planers, rolling-drawing and punching machines; complete and incomplete equipment of all kinds, electric meters and transformers of over 50 kVA, water meters, girder structures, storehouse frames and metal structures; means of transport; and metal accessories and semi-finished products thereof.

b/ Products which are small production tools, such as pliers, hammer, saw, chisel, shovel, hoe, sickle, mechanical tool-kit, and nail.

c/ Steel fence-nets of B27 to B41, barbwire, metal roofing sheets, metal force-bearing cables, and metal conveyor belts.

d/ Switchgear cabinets, safety cabinets, control cabinets, medium- and high-voltage cabinets; transformer stations, medium- and high-voltage kiosk stations; medium- and high-voltage isolation breakers; medium- and high-voltage cable terminals and underground cable box-terminals; fuses (12kV, 24kV, 36kV of 6A or more).

4. Automobiles of all kinds.

5. Automobile components, including engines, gearboxes, clutches and parts thereof.

6. Ships and boats.

7. Molds of all kinds, including molds used as tools to produce products and commodities.

8. Explosive materials, including explosives, delay igniters, detonators, and those processed into special-purpose explosive products without changing features and utilities of explosive materials.

9. Grindstone.

10. Artificial boards made of such raw materials as bamboo of all kinds, wood powder, wood in particles, wood fibers, sawdust, bagasse, and rice-husk spliced into sheets, excluding plywood and particle products from natural wood.

11. Industrial concrete products, including concrete girders, concrete beams and house-frames, concrete piles, concrete electric-poles, concrete round sewers and concrete boxes of all kinds, non-standard panels and pre-cast reinforced concrete components (except concrete bricks), and commodity concrete (concrete mortar).

12. Tires and tire-tube sets of 900-20 or more in size;

13. Neutral glass tubes (shaped tubes and pipes like injection syringes, and test-tubes).

14. Refined, rolled or drawn products of ferrous metals, non-ferrous metals and precious metals, excluding imported gold.

Refined, rolled or drawn products of ferrous metals, non-ferrous metals and precious metals include products directly made by the refining, rolling or drawing industries in the form of raw materials or products, such as metal products in the form of bars, rods, sheets or wires.

Tax rates for refined, rolled or drawn products already produced or processed into other products shall be determined according to commodities.

15. Automatic data processors and parts and accessories thereof (including computers of all kinds and computer parts, printers exclusively used for computers), excluding UPS.

16. Loading and unloading; dredging of channels, river ports and seaports; salvage and rescue.

17. Transportation (excluding international transportation), including goods, luggage and passenger transportation and tourist transportation by airways, roads, railways and waterways, except brokerage and commissioned agency, regardless of whether establishments directly conduct or hire others to conduct transportation activities.

18. Hotel business; and package tourist services.

19. Printing, except banknote printing.

Article 2. Making of invoices for goods and services eligible for VAT reduction

When making sale invoices for goods and services eligible for VAT rate reduction as guided in Article 1 of this Circular, the line for VAT rate shall be filled in with “10% x 50%”, the VAT amount, and the total amount payable by the purchaser.

For example:

Company A sells 60 computer sets to Company B under a contract signed between the two companies. The VAT-exclusive selling price is VND 5.2 million/set. Computers are eligible for 50% reduction of the applicable VAT rate. So, in a VAT invoice issued to Company B, Company A shall write:

“Computers” in the column “Goods and services”

Selling price: (VND) 5.2 million x 60 (sets) = VND 312 million

VAT rate: “10% x 50%”

VAT amount: VND 15.6 million

Total amount to be paid: VND 327.6 million.

Based on the added-value invoice, Company A shall declare the output VAT, while Company B declare the credited VAT amount of VND 15.6 million being the reduced VAT amount indicated on the invoice.

Article 3. Organization of implementation and effect

1. This Circular takes effect 45 days from the date of its signing and applies to goods and services specified in Article 1 of this Circular from February 1, 2009, to the end of December 31, 2009.

2. Any difficulties or problems arising in the course of implementation should be promptly reported to the Ministry of Finance for timely settlement.

For the Minister of Finance
Vice Minister
DO HOANG ANH TUAN