New tax policies applicable from January 01, 2024

1. VAT reduction policy to June 30, 2024

On December 28, 2023, the Government issued Decree No. 94/2023/ND-CP providing the value-added tax reduction policy, VAT tax reduction policy shall be applicable to goods and service groups currently subject to the VAT rate of 10% (to 8%), except the following goods and service groups:

- Telecommunications, finance, banking, securities, insurance, real estate business, metals, precast metal products, mineral products (excluding coal exploitation), coke, refined petroleum, and chemical products.
 

- Goods and services liable to excise tax.

- Information technology

By Resolution No. 110/2023/QH15 dated November 29, 2023, the National Assembly approves the VAT reduction policy of 2%.

Accordingly, the Resolution prescribes that:

VAT on goods and services specified in Point a Section 1.1 Clause 1 Article 3 of the National Assembly’s Resolution No. 43/2022/QH15 on fiscal and monetary policies for supporting socio-economic recovery and development program is reduced by 2% from January 01, 2024, to June 30, 2024, inclusively.

Therefore, the VAT reduction policy shall be applied from January 01, 2024, to June 30, 2024.

2. Increase 50% environmental protection tax on petrol, oil, grease

Resolution No. 42/2023/UBTVQH15 takes effect on January 01 2024 applies the reduction of 50% of environmental protection tax rates applicable to petrol, gas, and grease from January 1, 2024, to the end of December 31, 2024, in comparison with the regulations provided in Resolution No. 579/2018/UBTVQH14.

The environmental protection tax on petrol, oil, grease

From January 01, 2025, the environmental protection tax on petrol, oil, and grease is implemented under the regulations prescribed in Section I, Clause 1, Article 1, Resolution No. 579/2018/UBTVQH14.

3. Formally impose the global minimum tax regulations

In accordance with Clause 1, Article 8 of Resolution No. 107/2023/QH15, Vietnam shall formally impose the global minimum tax regulations from the financial year 2024.

Constituent entities of multinational enterprise (MNE) Groups that earn an annual revenue of EUR 750 million or more as stated in the consolidated financial statements of the ultimate parent companies in at least two out of the four fiscal years preceding the fiscal year.

The minimum tax rate is 15%.

4. Deadline for the reduction of registration fee rates applicable to domestically manufactured and assembled automobiles

The Decree No. 41/2023/ND-CP prescribes registration fee rates for automobiles, trailers or semi-trailers pulled by automobiles and vehicles like domestically manufactured and assembled automobiles.
 

From July 01, 2023, through December 31, 2023: The registration fee rates are equal to 50% of those prescribed in the Government’s Decree No. 10/2022/ND-CP of January 15, 2022, on the registration fee.

From January 1, 2024, onward: The registration fee rates shall further comply with the Government’s Decree No. 10/2022/ND-CP of January 15, 2022