The Ministry of Finance will implement government Decree No. 15 from February 1 on tax exemptions and reductions to support socio-economic recovery and development. Many goods and services are entitled to a VAT reduction of 8 per cent, which is estimated to cost VND49.4 trillion ($2.18 billion).
The new electronic invoice system introduced on November 21 will be a turning point for the tax sector, creating an important database for implementing tax management on a digital basis, effectively serving the sector’s digital transformation. Under the plan, by July 2022, the application of e-invoices will be completed in all 63 cities and provinces nationwide.
Taxes on business households incurred in the second half of 2021 are to be exempted, an online training course held by the General Department of Taxation heard. Exempted taxes include personal income tax, value added tax, special consumption tax, natural resources tax, and environmental protection tax.
On October 25, the General Department of Taxation opened the first phase of a network of Electronic Invoice Operation Centers at the Department and six localities’ Departments of Taxation. These six cities and provinces account for 60 per cent of businesses and 70 per cent of tax invoices in the country.
The Hanoi Tax Department’s contribution to State budget revenue totaled VND159.957 trillion ($7.03 billion) in the first nine months of 2021, a 3.8 per cent increase year-on-year. Tax collections have been down in the city over recent months due to Covid-19.
As of the end of September, businesses had been granted extensions on the payment of more than VND78.5 trillion ($3.45 billion) in land leasing fees and taxes under a decree from the government. This helped them boost liquidity and regain financial capacity amid Covid-19. It is expected that extensions on land leasing fees and taxes under the decree will total VND115 trillion ($5.06 billion).
The Ministry of Finance has proposed extending the suspension of excise taxes on domestic automobile production, which would help businesses gain more financial resources to overcome the severe impact of Covid-19.
Vietnam has applied a tax rate of 0 per cent on 31 items imported from Cambodia, such as live poultry, meat, and poultry by-products, rice, pork preparations, and unprocessed tobacco leaves until the end of 2022.
Hanoi is extending the timeframe for the payment of budget obligations for businesses and individuals, to ease the difficulties caused by Covid-19. The city has extended the payment time on nearly VND19 trillion ($831.11 million) of taxes and land rentals.
Tax revenues from the 23 localities that contribute 70 per cent of total State budget revenue have fallen substantially due to social distancing and suspended production. The General Department of Taxation will therefore promote tax collections on commercial business activities through e-commerce and digital platforms.
Under directions from the Ministry of Finance, the General Department of Taxation, and Hanoi authorities, the Hanoi Department of Taxation has promoted the digitalization of tax management. The Department has introduced a mobile tax app and reviewed 32,100 transactions on delivery apps and 756 landlords to prevent tax losses in e-commerce.
The Ministry of Finance (MoF) has proposed that the export tax on steel billets be increased and the preferential import tax (MFN) on certain iron and steel products be reduced.
Peru has recently approved the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), under which the country commits to eliminating 81 per cent of tariff lines once the agreement takes effect, equivalent to 62 per cent of import turnover from Vietnam, and eliminating 99.4 per cent of tariff lines within 17 years. After the effective date, goods exported to Peru with a tariff of 0 per cent will include outdoor furniture, agricultural products such as cashew nuts, tea, pepper, vegetables, and certain types of coffee, among others. Rates on textiles, garments and footwear will be cut to 0 per cent in the 16th year under a roadmap. Key export items include phones and electronic components, computers and electronic products, footwear, clinker and cement, textiles, and fisheries.