Proposal of reducing VAT rate to 8% from 1 July to 31 December 2023
Under the directing opinion of the Prime Minister and Deputy Prime Minister on the plan for tax and fee exemption and reduction applicable to 2023, the Director of Tax Policy Department issued the Official Dispatch No. 67/CST-GTGT on 7 April 2023, proposing to reduce the VAT rate to 8% from July 1, 2023,
Regarding the Official Dispatch No. 67/CST-GTGT in 2023, Tax Policy Department emphasized that the implementation of the directives of the Government Leaders and the Ministry’s leaders aims to stimulate consumption demand, recover and develop the economy.
In case of a 2% reduction of VAT rate for goods and services subject to the 10% tax rate, the implementation would be one of the following options:
- Option 1: Reducing the VAT rate by 2% for the group of goods and services subject to the 10% tax rate (remaining 8%).
- Option 2: Reducing the VAT rate by 2% for groups of goods and services currently applying the value-added tax rate of 10% (remaining 8%), except for some groups of goods and services as same as applied in 2022 according to Resolution 43/2022/QH15 dated January 11, 2022 of the National Assembly on fiscal and monetary policies to support the program of socio-economic recovery and development.
The implementation time of the above options would be from time the policy issued to the end of December, 2023 (expected from July 1, 2023 to December 31, 2023).
We will update as soon as there is an official announcement from the Government.
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