The Vietnam Chamber of Commerce and Business (VCCI) just lately despatched an official dispatch to the Ministry of Finance, suggesting adjustments to tax insurance policies.
Relating to value-added tax (VAT) cuts that expire at year-end, the VCCI proposed extending the tax cuts on industries most hard-hit by the pandemic, notably tourism and airways.
The extension is beneficial to transcend 2022 to assist industries get well.
The VCCI additionally urged the ministry to revise tax insurance policies on VAT-exempt merchandise, together with merchandise in agriculture and fishery industries.
The chamber stated present tax insurance policies don’t maintain some merchandise responsible for VAT, so the producers of these merchandise aren’t entitled to enter VAT deductions.
In the meantime, the producers nonetheless need to incur VAT on varied enter supplies, together with fuels and vitality.
“Accordingly, such insurance policies are placing these producers at an obstacle,” the chamber stated.
VCCI additionally stated that many imports have been zero per cent taxed of their origin nations and never topic to VAT in Viet Nam both, so that they had tax benefits over home merchandise.
Consequently, the chamber was involved that tax insurance policies would encourage imports to the detriment of home manufacturing.
The VCCI additionally imagine that these insurance policies would trigger disincentives to the division of labour and specialisation.
It may be the case as a result of producers would purchase fewer items and companies from exterior to incur much less non-deductible VAT.
“For these causes, the VCCI advocate shortening the record of VAT-exempt merchandise and holding them taxable,” the chamber stated.