Proposal to Continue Reducing VAT by 2% in the First 6 Months of 2025
In the 2022-2024 period, the National Assembly has resolved to reduce VAT rates by 2% for groups of goods and services currently subject to a VAT rate of 10% (to 8%), except for some groups of goods and services. The Ministry of Finance assesses that the solution to reduce VAT, along with other support solutions on taxes, fees, and charges, is creating great conditions to help businesses reduce production costs, increase profits, and increase the ability to stimulate demand. Along with that, the policy of reducing VAT by 2% has contributed to reducing costs through businesses with production and trading activities of goods and services that are entitled to reduced VAT, leading to a reduction in the selling price of goods and services for consumers. This has promoted business production and consumption of enterprises, contributed to creating more jobs for workers and achieved the goal set when building the VAT reduction policy, which is to stimulate consumption and promote production and business development.
Currently, the Ministry of Finance is proposing to develop a draft Resolution of the National Assembly on VAT reduction. In the draft submission, the Ministry of Finance proposes to reduce the VAT rate by 2%, applicable to groups of goods and services currently subject to a tax rate of 10% (to 8%), except for the following groups of goods and services: telecommunications, information technology, financial activities, banking, securities, insurance, real estate business, metals, prefabricated metal products, mining products (excluding coal mining), coke, refined petroleum, chemical products, goods and services subject to special consumption tax.
The Ministry of Finance said that if approved, the implementation period will start from January 1, 2025 to June 30, 2025.
