Decree 49/2022/ND-CP amending Decree 209/2013/ND-CP detailing the Law on Value-Added Tax

DECREE

Amending and supplementing a number of articles of the Government’s Decree No. 209/2013/ND-CP of December 18, 2013, detailing and guiding a number of articles of the Law on Value-Added Tax, which had a number of articles amended and supplemented under Decree No. 12/2015/ND-CP, Decree No. 100/2016/ND-CP and Decree No. 146/2017/ND-CP^[1]

Pursuant to the June 19, 2015 Law on Organization of the Government; and the November 22, 2019 Law Amending and Supplementing a Number of Articles of the Law on Organization of the Government and the Law on Organization of Local Administration;

Pursuant to the June 3, 2008 Law on Value-Added Tax; and the June 19, 2013 Law Amending and Supplementing a Number of Articles of the Law on Value-Added Tax;

Pursuant to the November 26, 2014 Law Amending and Supplementing a Number of Articles of the Tax Laws;

Pursuant to the April 6, 2016 Law Amending and Supplementing a Number of Articles of the Law on Value-Added Tax, the Law on Excise Tax and the Law on Tax Administration;

At the proposal of the Minister of Finance;

The Government promulgates the Decree amending and supplementing a number of articles of the Government’s Decree No. 209/2013/ND-CP of December 18, 2013, detailing and guiding a number of articles of the Law on Value-Added Tax, which had a number of articles amended and supplemented under Decree No. 12/2015/ND-CP, Decree No. 100/2016/ND-CP and Decree No. 146/2017/ND-CP.

Article 1. To amend and supplement a number of articles of the Government’s Decree No. 209/2013/ND-CP of December 18, 2013, detailing and guiding a number of articles of the Law on Value-Added Tax (below referred to as Decree No. 209/2013/ND-CP), which had a number of articles amended and supplemented under Decree No. 12/2015/ND-CP, Decree No. 100/2016/ND-CP and Decree No. 146/2017/ND-CP.

1. To amend and supplement Clauses 3 and 4, Article 4 as follows:

3. For real estate transfer activities, the taxable price is the real estate transfer price minus (-) the land price to be deducted for value-added tax calculation.

a/ The land price to be deducted for value-added tax calculation is specified as follows:

a.1/ In case of land allocation by the State for investment in infrastructure to build houses for sale, the land price to be deducted for value-added tax calculation is inclusive of the land use levy amount payable into the state budget in accordance with regulations on collection of land use levy and the amount for compensation and ground clearance (if any);

a.2/ In case of auction of land use rights, the land price to be deducted for value-added tax calculation is the auction-winning land price;

a.3/ In case of land lease for building infrastructure or building houses for sale, the land price to be deducted for value-added tax calculation is the land rental amount payable into the state budget in accordance with regulations on collection of land rental and water surface rental and the amount for compensation and ground clearance (if any).

The amount for compensation and ground clearance specified at Point a.1 or a.3 of this Clause is the amount for compensation and ground clearance stated in the plan approved by a state competent agency, which shall be deducted into the payable land use levy and land rental amount in accordance with regulations on collection of land use levy, land rental and water surface rental. 

a.4/ In case business establishments acquire land use rights from organizations or individuals, the land price to be deducted for value-added tax calculation is the land price applied at the time of acquisition, exclusive of the value of infrastructure. Business establishments may declare and credit input value-added tax on infrastructure (if any). In case it is impossible to determine the land price at the time of acquisition of land use rights, the land price to be deducted for value-added tax calculation is the land price set by the provincial-level People’s Committee at the time of signing the acquisition contract.

In case business establishments acquire real estate from organizations or individuals and the land price has been determined to be inclusive of the value of infrastructure under Point a, Clause 3, Article 4 of Decree No. 209/2013/ND-CP (which was amended and supplemented under Clause 3, Article 3 of Decree No. 12/2015/ND-CP of February 12, 2015), the land price to be deducted for value-added tax calculation is the land price applied at the time of acquisition of real estate, exclusive of infrastructure.

In case it is impossible to separate the value of infrastructure at the time of acquisition of real estate, the land price to be deducted for value-added tax calculation is the land price set by the provincial-level People’s Committee at the time of signing the acquisition contract.

a.5/ In case business establishments receive land use rights as contributed capital from organizations or individuals, the land price to be deducted for value-added tax calculation is the price written in the capital contribution contract. In case the land use rights transfer price is lower than the price of land received as contributed capital, the land price to be deducted for value-added tax calculation is the transfer price;

a.6/ In case real estate business establishments that implement works in the form of build-transfer (BT) and make payment in value of land use rights, the land price to be deducted for value-added tax calculation is the price applied at the time of signing the BT contract as prescribed by law; if, at the time of signing the BT contract, it is impossible to determine the land price, the land price to be deducted for value-added tax calculation is the land price decided by the provincial-level People’s Committee for payment for the works.

b/ In case of construction and commercial operation of infrastructure facilities or construction of houses for sale, transfer or lease, the taxable price is the amount collected according to the project implementation progress or payment progress written in the contract minus (-) the land price to be deducted in proportion to the ratio (%) of the collected amount to the total contractual value.

4. The taxable prices for power production activities of the Vietnam Electricity are as follows:

a/ For electricity produced by hydropower plants acting as dependent cost-accounting units of the Vietnam Electricity or power generation corporations, the taxable price for determination of the payable value-added tax amount in the locality where such a plant is located equals 35% of the average electricity retail price exclusive of value-added tax in accordance with the laws on electricity and price.

b/ For electricity produced by thermal power plants acting as dependent cost-accounting units of the Vietnam Electricity or power generation corporations, the taxable price for determination of the payable value-added tax amount in the locality where such a plant is located is the electricity selling price written in invoices under electricity purchase and sale contracts applicable to the thermal power plant.

In case of unavailability of electricity purchase and sale contracts applicable to thermal power plants, the taxable price is the average electricity retail price exclusive of value-added tax in accordance with the laws on electricity and price.

c/ For electricity produced by power production plants (except hydropower and thermal power) acting as dependent cost-accounting units of the Vietnam Electricity or power generation corporations, the taxable price for determination of the payable value-added tax amount in the locality where such a plant is located is the electricity selling price exclusive of value-added tax set by the competent state agency for each type of power generation.

In case of unavailability of the electricity selling price set by the competent state agency for each type of power generation as specified at this Point, the taxable price is the average electricity retail price exclusive of value-added tax in accordance with the laws on electricity and price.”

2. To amend and supplement Clause 3, Article 8 as follows:

“3. Business households that fail to comply or fully comply with regulations on accounting, invoices and documents in their business activities shall pay value-added tax by the presumption method as specified in Article 51 of the Law on Tax Administration.”

3. To amend and supplement Clause 2, Article 10 as follows:

“2. Business establishments shall be entitled to tax refund for investment projects as follows:

a/ Value-added tax refund shall be granted for business establishments that have made business registration and registered to pay value-added tax by the credit method (including also business establishments newly established under investment projects), have projects currently in the investment phase (including also investment projects subject to phasing or consisting of different items) in accordance with the Law on Investment in the provinces or cities where their head offices are located or the provinces or cities where their head offices are not located (except the cases specified at Point c of this Clause, and investment projects to build houses for sale and investment projects not involving formation of fixed assets), or oil and gas prospecting, exploration and development projects currently in the investment phase, if the accumulated amount of input value-added tax on goods and services generated in the investment phase that has not yet been fully credited is VND 300 million or more.

Business establishments shall separately declare added-value tax for investment projects and clear the input value-added tax amount of investment projects against the payable value-added tax amount for currently conducted production and business activities (if any). After the clearing, if the accumulated amount of input value-added tax of investment projects that has not yet been fully credited is VND 300 million or more, business establishments will be entitled to value-added tax refund.

In case investment projects of business establishments have been inspected, examined or audited by competent state agencies, tax offices may use inspection, examination or audit results to decide on value-added tax refund.

b/ Value-added tax refund under Point a of this Clause shall be granted for investment projects of establishments engaged in sectors and trades subject to conditional business investment that fall into the following cases:

b.1/ The investment projects are currently in the investment phase for which competent state agencies have granted permission for doing business in sectors or trades subject to conditional business investment in the form of license, certificate or written certification or approval in accordance with the law on investment and specialized laws;

b.2/ The investment projects are currently in the investment phase for which, for the time being, it is not required to obtain competent state agencies’ permission for doing business in sectors or trades subject to conditional business investment in the form of license, certificate or written certification or approval in accordance with the law on investment and specialized laws;

b.3/ The investment projects for which it is not required to obtain permission for doing business in sectors or trades subject to conditional business investment in the form of license, certificate or written certification or approval in accordance with the law on investment and specialized laws.

c/ Business establishments shall not be entitled to value-added tax refund but may carry forward to the next period the tax amount not yet credited under the law on investment for the following projects:

c.1/ Investment projects of establishments which do business in sectors or trades subject to conditional business investment while not fully satisfying the conditions for doing business under the Law on Investment as specified at Point a, Clause 1, Article 13 of the Law on Value-Added Tax, which was amended and supplemented under the Law Amending and Supplementing a Number of Articles of the Law on Value-Added Tax, the Law on Excise Tax and the Law on Tax Administration; these are investment projects of establishments which do business in sectors or trades subject to conditional business investment but have not yet been granted by competent state agencies permission for doing business in sectors and trades subject to conditional business investment in the form of license, certificate or written certification or approval, or fail to satisfy the conditions for conducting conditional business investment activities without having to obtain the written certification or approval in accordance with the law on investment (except the cases specified at Point b of this Clause).

Investment projects of establishments which do business in sectors or trades subject to conditional business investment which fail to fully maintain the business conditions throughout the operation duration as specified at Point a, Clause 1, Article 13 of the Law on Value-Added Tax, which was amended and supplemented under the Law Amending and Supplementing a Number of Articles of the Law on Value-Added Tax, the Law on Excise Tax and the Law on Tax Administration, are investment projects of establishments which do business in sectors or trades subject to conditional business investment which, in the operation duration, are subject to revocation of one of the following papers for doing business in sectors or trades subject to conditional business investment: licenses, certificates or written certifications or approvals; or which, in the operation duration, fail to satisfy the conditions for conducting conditional business investment activities in accordance with the law on investment. For these projects, the time for considering refusal of value-added tax refund shall be counted from the time the concerned business establishment has one of the above-mentioned papers revoked or from the time the competent state agency detects through inspection that the business establishment fails to satisfy the conditions for conducting conditional business investment activities.

c.2/ Investment projects on exploitation of natural resources and minerals licensed on or after July 1, 2016, or investment projects on production of products and goods with the total value of natural resources or minerals plus energy cost accounting for 51% or more of the cost price of products under investment projects, except the oil and gas prospecting, exploration and development projects specified at Point a of this Clause.

The determination of natural resources and minerals, value of natural resources and minerals, and the time for determination of the value of natural resources and minerals and energy cost must comply with Clause 11, Article 3 of this Decree.”

Article 2. Effect and implementation responsibility

1. This Decree takes effect on September 12, 2022.

2. The provisions on value-added tax refund for investment projects of establishments which do business in sectors or trades subject to conditional business investment specified in Clause 3, Article 1 of this Decree shall apply from the effective date of the Government’s Decree No. 100/2016/ND-CP of July 1, 2016.

In case business establishments have had the value-added tax amounts of their investment projects recovered under Point c, Clause 2, Article 10 of Decree No. 209/2013/ND-CP (which was amended and supplemented under Clause 6, Article 1 of Decree No. 100/2016/ND-CP), tax offices shall adjust value-added tax amounts, late-payment interests, and fines for tax-related administrative violations (if any). The clearing or refund of the overpaid amounts must comply with the law on tax administration.

3. To annul Article 2 of the Government’s Decree No. 10/2017/ND-CP of February 9, 2017, promulgating the Regulation on financial management applicable to the Vietnam Electricity, and amending and supplementing Clause 4, Article 4 of Decree No. 209/2013/ND-CP.

4. The Ministry of Finance shall guide the implementation of this Decree.

5. Ministers, heads of ministerial-level agencies, heads of government-attached agencies, chairpersons of provincial-level People’s Committees, and related organizations and individuals shall implement this Decree.-

On behalf of the Government
For the Prime Minister
Deputy Prime Minister
LE MINH KHAI