Official Letter 100/CTBDI-NVDTPC on Value-Added Tax Reduction According to Decree 180/2024/ND-CP

GENERAL DEPARTMENT OF TAXATION TAX DEPARTMENT OF BINH DINH PROVINCE	SOCIALIST REPUBLIC OF VIETNAM Independence - Freedom - Happiness
No: 100/CTBDI-NVDTPC	Binh Dinh, January 8, 2025

 

To: Business establishments in Binh Dinh province.

On December 31, 2024, the Government issued Decree No. 180/2024/ND-CP stipulating the policy on reducing value-added tax (VAT) according to Resolution No. 174/2024/QH15 dated November 30, 2024, of the National Assembly. The Tax Department of Binh Dinh province provides guidance to business establishments (BEs) in Binh Dinh province on the implementation and notes the following:

1. Goods and services subject to VAT reduction and the procedures to follow:

• VAT reduction applies to goods and services (G&S) currently taxed at 10%, excluding the following categories:
  • Telecommunications, financial activities, banking, securities, insurance, real estate business, metals and products made from cast metals, mineral products (excluding coal mining), coke, refined petroleum, and chemical products. Detailed in Appendix I attached to Decree No. 180/2024/ND-CP.
  • G&S subject to special consumption tax. Detailed in Appendix II attached to Decree No. 180/2024/ND-CP.
  • Information technology products under the law on information technology. Detailed in Appendix III attached to Decree No. 180/2024/ND-CP.
• The VAT reduction for G&S stipulated in point 1.1 is applied uniformly in import, production, processing, and commercial activities. For coal sold after extraction (including coal that undergoes screening and classification as per the closed process before sale), VAT reduction applies. Coal products listed in Appendix I attached to Decree No. 180/2024/ND-CP are exempt from VAT reduction at stages other than extraction and sale.

2. VAT reduction rate and procedures:

• Business establishments calculating VAT by the deduction method apply a VAT rate of 8% to G&S mentioned in point 1.1. When issuing invoices, the VAT rate of "8%" should be noted in the tax rate field.
• Business establishments calculating VAT based on the percentage of revenue are allowed to reduce the VAT rate by 20%. When issuing invoices for G&S with VAT reduction, the total amount before the reduction should be noted in the "Amount" column, and in the "Total goods and services" field, the reduced amount should be shown after applying a 20% reduction on the VAT rate. Additionally, include a note: “Reduced by... (amount) corresponding to a 20% reduction of the VAT rate according to Resolution No. 174/2024/QH15.”
• Business establishments in point 1.1 must declare VAT reduction using Form No. 01 in Appendix IV attached to Decree No. 180/2024/ND-CP along with the VAT declaration.

3. Note:

• The Tax Department of Binh Dinh has developed an application to look up G&S eligible for VAT reduction. This can be accessed on the Biditax.vn portal. Business establishments should use this tool for reference and application.

4. Effective date:

• Decree No. 180/2024/ND-CP, dated December 31, 2024, is effective from January 1, 2025, to June 30, 2025.

The Tax Department of Binh Dinh provides this guidance along with Decree No. 180/2024/ND-CP dated December 31, 2024, for business establishments to review and implement accordingly.

 

• Recipients:             As above; Provincial People’s Committee (for information); Leadership of the Tax Department; Department of Finance, Customs Department; People’s Committees of districts, towns, cities; Office, Departments under the Tax Department; Tax Branches in districts, towns, cities; Tax Department’s website; Archive: VT, NVDTPC.

See details here.