The new and notable points of Decree No. 180/2024/ND-CP regulating the value-added tax reduction policy according to Resolution 174/2024/QH15

Posted on: 02/01/2025

Decree No. 180/2024/ND-CP, issued on December 31, 2024, regulates the value-added tax (VAT) reduction policy according to Resolution No. 174/2024/QH15 of the National Assembly. Below are the new and notable points of this Decree:

VAT reduction to 8%: The Decree stipulates that the VAT rate will be reduced from 10% to 8% for certain goods and services from January 1, 2025, to June 30, 2025. This is one of the measures to support businesses and consumers in the context of a difficult economic environment.
List of goods and services not eligible for the tax reduction: Certain groups of goods and services will not be subject to this tax reduction, including:
- Telecommunications, financial, banking, securities, insurance services, and real estate business.
- Metals and products made from cast metals, mining products (except extracted coal), coke, refined petroleum, and chemical products.
- Products subject to special consumption tax and information technology as per the law.
Application method of the tax reduction:
- For businesses applying the credit method of VAT, the 8% VAT rate will be applied to goods and services subject to the tax reduction.
- For business households and individual businesses, the VAT calculation rate will be reduced by 20% when issuing invoices for goods and services eligible for the tax reduction.
Invoice issuance procedures: The Decree clearly stipulates how to issue VAT invoices when applying the new tax rate. Specifically, businesses must state the 8% VAT rate on the invoice and declare output and input VAT in accordance with regulations.
Application period: The Decree is effective from January 1, 2025, to June 30, 2025, to create favorable conditions for businesses and consumers during this period.