From January 01, 01, businesses will officially continue to apply the VAT reduction policy to 2025% according to Decree 8/180/ND-CP issued by the Government under Resolution 2024/174/QH2024 dated January 15, 30 of the National Assembly. The following are the contents that businesses need to know to apply.
Information
Continue to reduce VAT for groups of goods and services currently subject to a tax rate of 10% (except for some specific groups)
Industry groups receive VAT reduction
According to Decree 180/2024/ND-CP, from January 01, 01, the policy of reducing value added tax to 2025% will be applied to groups of goods and services currently applying a tax rate of 8%, except for the following groups of goods and services:
- Telecommunications, financial activities, banking, securities, insurance, real estate business, metals and prefabricated metal products, mining products (excluding coal mining), coke, refined petroleum, chemical products. Details in Appendix I.
- Goods and services subject to special consumption tax. Details in Appendix II.
- Information technology according to the law on information technology. Details in Appendix III.
VAT reduction
Business establishments that calculate value-added tax using the deduction method are subject to a value-added tax rate of 8%.
Business establishments (including business households and individual businesses) calculating value added tax according to the percentage method on revenue are entitled to a 20% reduction in the percentage rate for calculating value added tax when issuing invoices for goods and services eligible for reduced value added tax.
Apply
Subjects and time of application of VAT reduction policy
Time to apply VAT reduction: From February 01, 01 to December 2025, 30.
The reduction of value added tax for each type of goods and services above is applied uniformly at all levels import, production, processing, and commercial business.
In general, the application of the VAT reduction policy for the first 6 months of 2025 under Decree 180/2024/ND-CP is not much different from the application of the VAT reduction policy under Decree 72/2024/ND-CP for the last 6 months of 2024.
Goods and services are not eligible for VAT reduction
The cases of goods and services listed in Appendix I, II and III, if not subject to VAT or subject to 5% VAT according to the VAT Law, will not be entitled to VAT reduction.
Look up directly Appendix I, II, III of Decree 180/2024/ND-CP here.
Or view original PDF file:
- PDF file of Appendix I issued with Decree 180/2024/ND-CP: Appendix I issued with Decree 180/2024/ND-CP.
- PDF file of Appendix II issued with Decree 180/2024/ND-CP: Appendix II issued with Decree 180/2024/ND-CP.
- PDF file of Appendix III issued with Decree /2024/ND-CP: Appendix III issued with Decree 180/2024/ND-CP.
How to determine items eligible for reduced VAT rate to 8%
Case 1: If the unit has grasped the industry codes of the goods and services requiring invoices:
If the industry code of that item is in one of the 3 appendices above and is not subject to 5% VAT or not subject to tax >> The unit is eligible for a tax reduction from 10% to 8%.
Case 2: If the unit does not know the industry codes of the goods and services that need to be invoiced
- Step 1: Look up the industry code corresponding to the name of the goods and services at List and content of Vietnamese product industry system (Issued with Decision No. 43/2018/QD-TTg dated November 01, 11 of the Prime Minister).
- Step 2: After knowing your industry code >> compare it with appendix I, II, III similar to that stated in Case 1.
Perform
Order and procedures for implementing VAT reduction policy
The method of writing on invoices for business establishments calculating VAT according to the deduction method is to apply the VAT rate of 8% to the following goods and services:
- When making value-added invoices for providing goods and services subject to value-added tax reduction, write "8%" in the value-added tax rate line; value added tax; total amount the buyer must pay. Based on the value-added invoice, business establishments selling goods and services declare output value-added tax, business establishments purchasing goods and services declare input value-added tax deduction. according to the reduced tax amount recorded on the value-added invoice.
- In cases where different tax rates are applied when selling goods or providing services, the value-added invoice must clearly state the tax rate of each good or service as prescribed in Clause 3 of this Article.
How to write on invoices for business establishments (including business households and individual businesses) calculating value added tax according to the % method on revenue:
- When preparing a sales invoice for providing goods and services subject to value-added tax reduction, in the "Amount" column, write the full amount of goods and services before reduction, in the line "Add the cost of goods, services" write down the number that has reduced the percentage rate on revenue by 20%, and also note: "has reduced... (amount) corresponding to 20% of the percentage rate to calculate value added tax according to Resolution No. 142/2024/QH15”.
- When selling goods or providing services, the sales invoice must clearly state the reduced amount as stated above.
How to adjust invoices already created:
In case the business establishment has issued an invoice and declared the tax rate or percentage to calculate value added tax that has not been reduced according to the provisions of this Decree, the seller and buyer will process the invoice. prepared according to legal regulations on invoices and documents. Based on the invoice after processing, the seller declares output tax adjustments, and the buyer declares input tax adjustments (if any).
Supplementing regulations when declaring monthly/quarterly VAT
Business establishments specified in this Article shall declare goods and services eligible for reduced value-added tax according to Form No. 01 in Appendix IV issued with this Decree along with the value-added tax declaration. .
