VAT rate in 2023
From February 1, 2022, the value-added tax (VAT) for groups of goods and services being applied at the tax rate of 10% will be reduced to 8%. Entering 2023, this tax rate has some changes, this article by Tasco will help customers understand the VAT rate in 2023.
1. VAT rates in 2023:
📜 Since the value-added tax rate is no longer reduced to 8% according to Resolution 43/2022/QH15 and Decree 15/2022/ND-CP, the value-added tax rate in 2023 is implemented in accordance with the provisions of Decree No. Specifically, the Law on Value Added Tax includes the following tax rates:
👉 0% tax rate;
👉 5% tax rate;
👉 10% tax rate.
2. Items subject to 0% tax rate:
⏩ The tax rate of 0% applies to exported goods and services, international transport, and goods and services not subject to value-added tax upon export, except for the following cases:
⇒ Transfer of technology, transfer of intellectual property rights abroad;
⇒ Offshore reinsurance service;
⇒ Credit service;
⇒ Capital transfer;
⇒ Derivative financial services;
⇒ Postal and telecommunications services;
⇒ Exported products are exploited natural resources and minerals that have not been processed into other products; exported products are goods processed from natural resources and minerals with the total value of resources and minerals plus energy costs accounting for 51% or more of the product cost.
⏩ Exported goods and services are goods and services that are consumed outside Vietnam or in a non-tariff zone; goods and services provided to foreign customers according to the Government's regulations include:
⇒ Goods exported to foreign countries, including export entrustment;
⇒ Goods sold into non-tariff zones according to the Prime Minister's regulations; goods sold to duty-free shops;
⇒ Goods sold but delivery and receipt points are outside Vietnam;
⇒ Spare parts and supplies for repair and maintenance of vehicles, machinery, and equipment for foreign parties and for consumption outside Vietnam;
⏩ Cases that are considered export according to the provisions of law:
⇒ Transitional processed goods according to the provisions of commercial law on international goods purchase and sale activities and goods purchase, sale, and processing agency activities with foreign countries.
⇒ Goods exported on the spot as prescribed by law.
⇒ Goods exported for sale at overseas fairs and exhibitions.
⏩ Conditions to apply the 0% tax rate to exported goods:
⇒ Having a contract to sell or process export goods; entrusted export contract;
⇒ Having documents of payment for exported goods via banks and other documents as prescribed by law;
⇒ Have a customs declaration in accordance with the law.
⏩ Note: Particularly for the case of goods sold and the point of delivery and receipt of goods is outside Vietnam, the business establishment (the seller) must have documents proving the delivery and receipt of goods outside Vietnam such as:
⇒ Goods purchase contract signed with the overseas seller;
⇒ Goods sale contract signed with the purchaser;
⇒ Documents proving that goods are delivered or received outside of Vietnam such as commercial invoices according to international practices, bills of lading, packing slips, and certificates of origin...;
⇒ Payment documents via bank include: documents via a bank of the business establishment making payment to the seller of goods abroad; vouchers of payment via a bank of the purchaser of the goods to the business establishment.
3. Goods subject to the 5% tax rate:
➤ Clean water for production and daily life;
➤ Ore for fertilizer production; pesticides and growth stimulants for livestock and plants;
➤ Excavation and embankment services, dredging canals, ditches, ponds, and lakes for agricultural production; cultivating, caring for, and preventing pests and diseases for plants; preliminary processing and preservation of agricultural products;
➤ Unprocessed crop, livestock, and fishery products, except for products of cultivation, farming, and aquaculture, which have not been processed into other products or are only preliminarily processed by the organization. , individuals produce, catch, sell, and import.
➤ Preliminarily processed rubber latex; preliminarily processed turpentine; nets, ropes and yarns for knitting fishing nets;
➤ Fresh food; unprocessed forest products, except wood, bamboo shoots, and products of cultivation, farming, and aquaculture, which have not been processed into other products or have only undergone normal preliminary processing of self-producing organizations or individuals. export, catch for sale, and at the import stage;
➤ Sugar; by-products in sugar production, including sugar molasses, bagasse, and sludge;
➤ Products made of jute, sedge, bamboo, leaves, straw, coconut shells, coconut skulls, water hyacinth, and other handicraft products made with raw materials used from agriculture; primary cotton; newsprint;
➤ Medical equipment and instruments; cotton, medical tampons; preventive and curative drugs; pharmaceutical chemical products, herbal ingredients are raw materials for the production of curative and preventive drugs;
➤ Teaching and learning materials, including models, drawings, boards, chalks, rulers, compasses, and other specialized equipment and tools for teaching, research, and experiments science;
➤ Cultural activities, exhibitions, physical training and sports; performing Arts; make film; import, distribution and screening of films;
➤ Children's toys; books of all kinds, except for political books, textbooks, books of legal documents, scientific and technical books, and books printed in ethnic minority languages;
➤ Scientific and technological services in accordance with the Law on Science and Technology;
➤ Sale, lease, lease-purchase of social housing in accordance with the Law on Housing.
4. Goods subject to the 10% tax rate:
The 10% tax rate applies to goods and services not subject to the 0% and 5% tax rates mentioned above.
⇒ If you have any questions or need assistance with property rental tax declaration and payment, please register here for TASCO's earliest advice and support or contact the hotline: 0975480868 (Zalo)
TASCO TAX CONSULTING SERVICES CO., LTD
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