VAT reduction policy extended by late June, 2024

On November 29, 2023, the National Assembly passed the resolution to extend the 2 percent value-added tax cut until June 30, 2024. 

Earlier, the Government planned to reduce VAT by 2 percent from July 1, 2023 to December 31, 2023.

The VAT reduction policy is applied to almost all groups of products and services, except for telecommunications, information technology, financial activities, banking, securities, insurance, real estate transactions, metal production and production of prefabricated metal products, coal mining, refined petroleum, production of chemicals and chemical products, along with goods and services subject to special consumption tax.

The Ministry of Finance estimated that the State budget revenue will be reduced by approximately VND25 trillion in the first six months of 2024.

The Government says the VAT reduction is needed to spur the national economy which has been impacted by the prolonged COVID-19 pandemic, along with the profound impact of climate change and natural disasters./.