Vietnam defers more than VND 80,200 billion taxes to counter impact of COVID-19

Photo: VOV

The Ministry of Finance has officially submitted to the Government a Decree to defer tax payments (4 tax categories) and land-use fees. This would be worth USD 3,420 million (VND 80,200 billion).

According to the Ministry of Finance, VND 80,200 billion worth of 4 payable tax categories will be deferred. The total amount of tax breaks and deferred tax payments include value added tax (VAT) of more than VND 61,600 billion, corporate income tax (CIT) of over VND 11,100 billion, individuals and business households taxes of more than VND 3,000 billion, and land-use taxes of more than VND 4,500 billion by the end of 2020.

The COVID-19 pandemic has directly affected many industries and production sectors of the country, causing supply chain disruptions and indirect effects on the whole economy due to slower Chinese and global economic growth.

Beneficiaries of the tax breaks and deferment are enterprises, organizations, households and individuals in (i) Agriculture, forestry, fishing and aquaculture; (ii) Food production and processing; textile, clothing, footwear production; rubber; electronic, computers and optical products; automobiles and other motor vehicles; (iii) Railway transport; bus services; other road transport; water transport; air transport; warehousing and support activities for transportation; (iv) Accommodation service; food service; travel, tour and support services related to tourism promotion and organization; (v) Education and training; health and social assistance activities; creative, artistic and recreational activities; sports; activities of botanical gardens, zoos and nature reserves; amusement parks and theme parks; cinema.

Regarding VAT (except for import VAT), tax payment deadline will be extended for the tax amounts arising in the tax periods of March, April, May and June 2020 (for VAT declarations on a monthly basis) and first and second quarters of 2020 (for VAT declarations on a quarterly basis) of the above-mentioned enterprises and organizations. The grace period is 5 months from the end of the deadline for VAT payment according to the Law on Tax Administration.

Regarding CIT, tax payment deadline will be extended for the remaining unpaid taxes according to the balance sheet of 2019 and the provisional tax amount in the first and second quarters of 2020. The grace period is 5 months from the end of the time limit for CIT payment in accordance with the Law on Tax Administration.

Regarding taxes for business households and individuals, tax payment deadline will be extended for VAT and personal income tax (PIT) in 2020 for business households and individuals in the above-mentioned economic sectors. The new deadline will be December 15, 2020.

Regarding land-use fees, the payment term in the first period of 2020 will be extended for enterprises, organizations and individuals that lease the land directly from the Government under contracts with respective state agencies in the form of annual land-use payment stated in the land lease Decision or contract.

Particularly for small and micro enterprises, the entire land-use fee payable for the first period of 2020 will be extended for 5 additional months from May 31, 2020.

In order to simplify administrative procedures and promptly remove difficulties for enterprises, business organizations, and individual taxpayers, only one tax defer application will be required for all tax defer periods and the deadline for filing tax deferral is July 30, 2020.