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Saturday, October 16, 2021

Resolution on tax cuts to be adopted before Oct 1

By Van Ly

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HANOI – The Standing Committee of the National Assembly (NA) has approved issuing a resolution on tax cuts for businesses and individuals affected by the Covid-19 pandemic and will send it to the NA chairperson for signature before October 1, the committee announced at its meeting on September 16.

Minister of Finance Ho Duc Phoc said the unpredictable development of the Covid-19 pandemic has left severe impact on businesses and people. To help them ride out the difficulties, the Government will introduce tax incentives.

In this regard, the Government will extend the payment deadlines of value added tax (VAT), corporate income tax, personal income tax and land rentals in 2021 for businesses and people affected by the pandemic.

Besides, the Government will continue to cut environmental protection tax for aviation fuels, import tariffs and 30 other taxes and fees until December 31, 2021. 

Addressing the meeting, members of the NA Standing Committee said the resilience of businesses has weakened significantly, especially after the fourth wave of the coronavirus that began in late April.

Chairman of the NA’s Legal Affairs Committee Hoang Thanh Tung said the NA Standing Committee should promptly issue this resolution to support enterprises, business households and people that are struggling with the pandemic. 

According to the Minister of Finance, a 30% cut on corporate income tax following the NA’s Resolution No. 116 last year has effectively helped businesses, cooperatives and other organizations and was highly lauded by economic experts and the business community. 

Therefore, the Government has proposed continuing to cut corporate income tax by 30% this year.

The Minister of Finance said based on suggestions from the NA chairperson and the NA’s Committees of Finance and Budget, and Legal Affairs, the Government has amended the policies to ensure they benefit the right individuals, organizations and businesses and are suitable with the situation and the State budget. 

Phoc said in accordance with the prevailing Law on Value Added Tax, the country is applying a VAT of 10% on the price of most goods and 15% on luxury items.

The Government has proposed reducing VAT by 30% in the last three months this year for a number of sectors including transport, accommodation, food and beverages, tourism, publishing, film making, music production, entertainment and sports.

The Committee of Finance and Budget said the Government should reject online services from the list of beneficiaries because these services have not been severely affected by the pandemic. 

Given the depleted State budget, NA Chairman Vuong Dinh Hue asked the Ministry of Finance to specify the beneficiaries of these policies to prevent those unaffected by the pandemic from enjoying the incentives. 

NA Vice Chairman Nguyen Duc Hai asked the Committee of Finance and Budget to work with the Committee of Legal Affairs and the Ministry of Finance to complete the resolution and submit it to the NA chairman for approval before October 1, 2021. 

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