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On October 19, 2021, the National Assembly Standing Committee issued Resolution 406/NQ-UBTVQH15 in 2021 on a number of solutions to support enterprises and people affected by the COVID-19 epidemic. In particular, mention is made of tax exemption and reduction solutions for enterprises affected by the Covid-19 epidemic, specifically as follows:
(1) A reduction of 30% in the payable corporate income tax amount of 2021:
This tax reduction policy only applies to taxpayers under the provisions of the Law on Corporate Income Tax whose revenue in 2021 is not more than 200 billion VND and the revenue in 2021 is lower than the revenue in 2019.
* Note: The decrease in revenue in 2021 compared to the revenue in 2019 will not prevail as a criterion for reduction of paying corporate income tax if the taxpayer has just been established, engaged in consolidation, merger, partial division, or full division in the tax period of 2020 or 2021.
(2) Exemption of late payment interest incurred in 2020 and 2021 on debts of taxes, land use levies, and land rents to enterprises and organizations (including affiliated entities, places of business) that incur losses in 2020.
* Note: This provision does not apply to a case where the late payment interest has been paid.
(3) Apply reduction of value-added tax from November 1, 2021, to the end of December 31, 2021
– This policy applies to the following goods and services:
(i) Transport services (railway transport, water transport, aviation transport, other road transport); accommodation services; food and drink services; services of travel agencies, tour operators and support services, related to promotion and organization of tours;
(ii) Publishing products and services; cinematographic services, production of the television programs, sound recording and music publishing; works of art and services for composing, arts, and entertainment; services of libraries, archives, museums, and other cultural activities; sports, recreation, and entertainment services.
The goods and services mentioned in category (ii) do not include publishing software, and goods and services provided in the online form.
– The value-added tax reduction for the above cases is applied as follows:
(i) If the credit method is used, the enterprise will be eligible for a reduction of 30% in VAT rate;
(ii) If the direct method (payable VAT amount equals given rate multiplied by revenue) is used, the enterprise will be eligible for a reduction of 30% in the rate for direct VAT calculation.
This Resolution takes effect from October 19, 2021.