Decree 180/2024/ND-CP providing VAT reduction policy under Resolution 174/2024/QH15

DECREE

Providing the value-added tax reduction policy under the National Assembly’s Resolution No. 174/2024/QH15 of November 30, 2024^[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; the June 19, 2013 Law Amending and Supplementing a Number of Articles of the Law on Value-Added Tax; and the April 6, 2016 Law Amending and Supplementing a Number of Articles of the Law on Value-Added Tax, Law on Excise Tax and Law on Tax Administration;

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

Pursuant to the June 13, 2019 Law on Tax Administration;

Pursuant to the National Assembly’s Resolution No. 174/2024/QH15 of November 30, 2024, on the 15^th National Assembly’s 8^th session;

At the proposal of the Minister of Finance;

The Government promulgates the Decree providing the value-added tax reduction policy under the National Assembly’s Resolution No. 174/2024/QH15 of November 30, 2024.

Article 1. Reduction of value-added tax (VAT)

1. To reduce VAT for goods and service groups currently subject to a 10% VAT rate, except the following goods and service groups: 

a/ Telecommunications, finance, banking, securities, insurance, real estate business, metals and precast metal products, products from mining (excluding coal mining), coke, refined petroleum, and chemical products. Details are provided in Appendix I to this Decree.

b/ Goods and services liable to excise tax. Details are provided in Appendix II to this Decree.

c/ Information technology as defined in the law on information technology. Details are provided in Appendix III to this Decree.

d/ The VAT reduction for separate goods or service items specified in Clause 1 of this Article shall be uniformly applied at the stages of import, production, processing and commercial trading. Coal mined for sale (including also coal mined and then sorted out and classified under a closed process prior to sale) is eligible for VAT reduction. Coal products provided in Appendix I to this Decree at stages other than the stage of mining for sale are not eligible for VAT reduction.

Corporations and economic groups that perform the closed process before selling mined coal are also eligible for VAT reduction for such coal. 

The goods and services specified in Appendices I, II and III to this Decree that are not liable to VAT or subject to the 5% VAT rate as prescribed in the Law on Value-Added Tax must comply with the Law on Value-Added Tax and are not eligible for VAT reduction.

2. VAT reduced rates

a/ Business establishments that calculate VAT using the credit method shall be subject to an 8% VAT rate for the goods and services specified in Clause 1 of this Article.

b/ Business establishments (including also business households and business individuals) that calculate VAT using the percentage-of-sales method shall enjoy a 20%-reduction in the percentage rate used for VAT calculation when issuing invoices for the goods and services eligible for VAT reduction specified in Clause 1 of this Article.  

3. Order and procedures for implementation

a/ When issuing a value-added invoice for a goods or service eligible for VAT reduction, a business establishment specified at Point a, Clause 2 of this Article shall indicate “8%” in the “VAT rate” line; VAT amount; and the total amount payable by the purchaser. Based on the value-added invoice, the business establishment selling goods or providing services shall declare output VAT and the business astablishment purchasing goods or services shall declare input VAT credit based on the reduced VAT amount stated in the value-added invoice.

b/ When issuing a sale invoice for a goods or service eligible for VAT reduction, a business establishment specified at Point b, Clause 2 of this Article shall inscribe the full price of the goods or service before tax reduction in the “Amount” column, and the amount reflecting a 20% reduction in the percentage of sales in the “Total amount” line and note “….(amount) reduced that corresponds to a 20% reduction in the percentage of sales used for VAT calculation under Resolution No. 174/2024/QH15”.

4. When selling goods or providing services subject to different tax rates, a business establishment specified at Point a, Clause 2 of this Article shall inscribe the VAT rates for separate goods or services on the value-added invoice under Clause 3 of this Article.

When selling goods or providing services, a business establishment specified at Point b, Clause 2 of this Article shall inscribe the reduced amount on the sale invoice under Clause 3 of this Article.

5. In case a business establishment has issued an invoice and declared VAT at the rate or the percentage of sales used for VAT calculation not yet reduced under this Decree, the seller and the purchaser shall modify the issued invoice under the regulations on invoices and documents. Based on the modified invoice, the seller shall declare the adjusted output VAT amount and the purchaser shall declare the adjusted input VAT amount (if any).

6. The business establishments specified in this Article shall make declarations of goods and services eligible for VAT reduction, made according to Form No. 01 provided in Appendix IV to this Decree, and enclose them with VAT declaration forms.

Article 2. Effect and organization of implementation

1. This Decree takes effect from January 1, 2025 through June 30, 2025.

2. Ministries, within the ambit of their functions and tasks, and provincial-level People’s Committees shall direct related agencies in disseminating, guiding, examining and supervising the implementation of this Decree so as to help consumers understand and benefit from the VAT reduction policy under Article 1 of this Decree, focusing on solutions for stabilizing the supply and demand of goods and services eligible for VAT reduction in order to ensure stable market prices (VAT-exclusive prices) from January 1, 2025, through June 30, 2025.

3. Any problems arising in the course of implementation of this Decree should be reported to the Ministry of Finance for guidance and settlement.

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

On behalf of the Government
For the Prime Minister
Deputy Prime Minister
HO DUC PHOC

* The Appendices to this Decree are not translated.