Unifying Vietnam's tax policy system until 2030

VCN - The tax system reform strategy until 2030, approved by the Prime Minister, has set the goal of unifying Vietnam's tax policy system to meet the resource requirements to implement the 10-year socio-economic development strategy (2021-2030).
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Illustrative Photo: Internet
Illustrative Photo: Internet

For value-added tax (VAT), the Strategy aims to expand the tax base by reducing goods and services that are not subject to VAT and goods and services subject to the 5% tax rate; projects to one tax rate; review to raise VAT rate according to the roadmap; review and adjust the revenue threshold applying the deduction method in accordance with reality; study and apply the tax calculation method according to the percentage over the turnover for taxpayers whose turnover is below the threshold or are not eligible to apply the deduction method; complete VAT-related regulations on exported goods and services, in accordance with their nature and international practices.

Along with that, it is studying to amend and supplement regulations on VAT deduction and refund towards simplicity, transparency and uniformity with relevant provisions.

For excise tax, the tax sector will have to review, research, amend and supplement subjects of excise tax to regulate consumption in accordance with the shift in consumption trends in society and orientations of the Party and State on the protection of people's health and environmental protection; develop a roadmap to increase tax for cigarettes, beer and alcohol products to limit production and consumption and fulfill international commitments; review and adjust excise tax rates on a number of items to meet the socio-economic conditions in the 2021-2030 period; study to apply proportional tax rate combined with fixed tax rate on a number of goods and services subject to excise tax.

For export and import taxes, the tax sector will continue to reduce the number of tax rates to simplify the import tariff, striving to reduce the number of import tax rates from 32 to about 25 by 2025 and 20 by 2030; study amending and supplementing export tax and import tax policies to promote exports, encourage the increase of domestic value, and limit the export of natural resources, raw materials; offer appropriate preferential policies to promote the development of spearhead industries, supporting industries and priority areas in accordance with the country's socio-economic development orientations in each period and international commitments; research and amend regulations on on-the-spot imports and exports and regulations related to non-tariff zones, in compliance with relevant laws, limiting trade fraud and tax evasion.

For corporate income tax, the tax sector will review to amend or abolish tax exemption and reduction incentives that are no longer appropriate with development requirements and international integration requirements; minimize the integration of social policies with tax exemption and reduction policies, ensure tax neutrality for stable application in the medium and long term; offer corporate income tax incentives for small and micro enterprises, and change policy of foreign investment attraction from quantity to quality, encourage all enterprises to invest in key industries and areas; expand the tax base in accordance with the country's socio-economic context and international practices; implement standards of prevention and combat against transfer pricing, and anti-erosion of revenues according to international practices.

For personal income tax, the tax sector will review and add taxable objects; research, amend and supplement tax rates suitable to taxable income; simplify conditions in personal income tax finalization for both taxpayers and tax agencies; prevent acts of tax evasion and avoidance; study, amend and supplement regulations on tax exemption and reduction in accordance with the country's socio-economic context in each period and international practices.

For natural resource tax, the tax sector will study and amend regulations on taxable prices, and taxable natural resource outputs; amend the tax framework, tax rates, and exemption and reduction of natural resource tax transparently, ensuring that the resource tax policy continues to be an effective tool to contribute to the management and protection of natural resources, and to encourage the economical and efficient use of natural resources, encourage deep processing and increase the value of resources.

For taxes related to property (including agricultural land use tax and non-agricultural land use tax), the tax sector will continue to exempt agricultural land use tax until the end of 2025 under the policies and views of the Party and State on agricultural and rural development; and review and evaluate the performance of the non-agricultural land use tax policies.

Thereby, the tax sector will increase the regulation for land and collect tax for houses in order to encourage effective use of houses and land, contributing to limiting speculation, to ensure reasonable and stable revenues for the state budget, in line with Vietnam's socio-economic conditions and international practices.

Moreover, the tax sector will develop tax policies in a simple way that is easy to understand, and easy to identify taxpayers of properties and tax payable, in accordance with the provisions of the land law and relevant laws.

As for the green tax, the tax sector will research expanding the subjects of green tax for goods causing environmental pollution; review to adjust the tax framework and rates in order to ensure that the green tax policy is an important economic tool that contributes to limiting the import, production and use of goods causing environmental pollution.

With regard to fees and charges and other state budget revenues, the tax sector will review and perfect the legal system of fees and charges in the direction of effectively exploiting the sources of fees and charges from properties and resources, environment protection; carry out the roadmap to increase the fee rate to calculate all costs in the fee rate; accelerate the transition from fees into public service prices; encourage the promotion of socialization of public service provision; strengthen administrative procedure reform, provide online public services to further improve the business environment, free up society's resources and contribute to improving national competitiveness in compliance with the policy of organization and rearrangement of the apparatus of state agencies and service delivery units.

Tax policy -  foundation for development of Vietnam's auto supporting industry Tax policy - foundation for development of Vietnam's auto supporting industry

Moreover, the tax sector will build revenues or levy tax on new business activities in accordance with the actual development trend, ensuring the right of tax collection and assessment of Vietnam in compliance with the social-economic context in each period and international practices. Furthermore, the tax sector will review and improve policies on other revenues managed by the State budget in line with the reality and specialized laws.

By Thuy Linh/ Huyen Trang

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