HCMC – The Ministry of Finance has allayed the concerns of the Bac Lieu National Assembly delegation about Vietnam’s 10% VAT and assured them that the tax rate is appropriate and aligns with the country’s economic goals.
The delegation has urged the Government to reconsider the VAT structure, saying that consumers already burdened with costs should not be subjected to a 10% tax.
In response, the Ministry of Finance stated that VAT is an indirect tax applied to the added value of goods and services during production and distribution. The ministry emphasized the importance of VAT as a significant and stable source of revenue for the State budget, contributing 24.5% of total tax revenue in 2022 and 23% in 2023.
The ministry also pointed out that many countries in the developed and developing worlds rely heavily on VAT as a primary stream of revenue. It noted that Vietnam’s 10% VAT rate is relatively low compared to global common rates, where 122 countries impose rates between 13% and 27%.
The ministry added that some National Assembly deputies had suggested increasing the VAT rate during discussions on a proposed amendment to the VAT law. However, the Government will continue to study the issue and consider the timing for any potential adjustments as part of its ongoing tax reform strategy.
