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Vietnam goes to single VAT rate

Proposal to eliminate reduced rate as part of wider 2030 tax simplification plans

Vietnam has proposed consolidating its reduced rate of 5% with the standard rate of 10%.  The reduced rate currently includes:

  • Basic foodstuff;
  • transport;
  • agriculture;
  • medicines;
  • cultural,
  • cinema;
  • books;
  • education;
  • scientific and tech.

Vietnam also intends to extend the tax base to bring more supplies out of the reduced Value Added Tax rate.

Vietnam cut its VAT rate to 8% on a range of goods between February and December 2022 for most supplies in recognition of the ongoing COVID-19 pandemic. The Special Consumption Tax on tobacco, alcohol will be extended to other products and will be raised.

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