Tax Alert June 2024

Draft Value Added Tax Law (5th Draft dated April 24, 2024)

On April 24, 2024, the National Assembly convened and presented the fifth draft of the Value Added Tax Law (amendment), which includes several notable changes. This brief will summarize some key points of revision compared to the previous draft to keep you informed of the amendment roadmap of the Law. 

No.	Content	Article, Clause	Detail
1	Supplement	Article 4, Clause 3	Value Added Tax payers: Organizations engaged in production and business activities in Vietnam purchasing goods, services for exploration, survey, development, and exploitation of oil and gas by foreign organizations without a permanent establishment in Vietnam, individuals residing abroad are non-residents in Vietnam.
2	Supplement	Article 13, Clause 1, Point dd	Taxdeclaration for missing invoices: Adding provisions allowing enterprises to declare, deduct the input VAT amount omitted in the period of detection of omission, before the tax authority announces the tax inspection decision, tax inspection at the taxpayer's headquarters; This provision does not apply to incorrect invoices.
3	Supplement	Article 7, Clause 1, Point l	Tax calculation for casino business services, electronic games with prizes, betting: the amount subject to tax for this activity is the amount received from this activity minus the amount refunded to customers and the amount paid out as prizes (if any), already subject to special consumption tax, excluding value-added tax.
4	Supplement	Article 14, Clauses 1, 2	Addition of conditions for tax refund, expanding the subjects of VAT refund for the following cases: Businesses only producing goods, supplying services subject to a VAT rate of 5% generating input VAT not fully deducted from 300 million VND upwards after 12 months or 04 quarters Businesses doing business already registered for VAT deduction method with investment projects (including new investment projects and expansion investment projects) according to the investment law provisions are in the investment stage with input VAT of the investment project not fully deducted from 300 million VND upwards. The deadline for businesses to refund VAT is not more than 01 year from the date the investment project or investment stage/item is completed (Clause 2, Article 14)
5	Supplement	Article 14, Clause 3	Supplementing and legalize regulations on VAT refund for businesses that have both exported goods, services and domestic consumed ones within the same period.
6	Amend	Article 9, Clause 1, Point b	Supplementing and legalize regulations on VAT refund for businesses that have both exported goods, services and domestic consumed ones within the same period.
7	Amend	Article 5, Clause 25	Revenue threshold for goods, service sales not subject to VAT of households, individual businesses: instead of from the level of 100 million VND/year (as currently regulated) or from the level of 150 million VND/year (according to the previous draft) to below the level stipulated by the Government
8	Amend	Article 13, Clause 2	Conditions for non-cash payment when applying tax deduction: amended to: Having non-cash payment documents for goods, services purchased "except for some special cases as prescribed by the Government

Other amendments and supplementations are remain unchanged or only have minor updates in wording compared to the latest draft. You can read previous updates from RSM for the most complete information.

We will keep you posted on on this matter.

Should you have any concerns during the process of implementing the regulations, please contact us. 

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Tax Alert June - Draft Value Added Tax Law_En_RSM Vietnam

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