Guidance on determining imported goods that are not eligible for a 2% VAT reduction

✨ In order to create favorable conditions for businesses and people to enjoy tax exemption and reduction policies, and conveniently issued invoices, the Government issued Decree No. 15/2022/ND-CP

✨ On February 25, 2022, the General Department of Customs issued Official dispatch 642/TCHQ-TXNK declaring VAT rates, determining names, and applying HS codes of imported goods not eligible for tax reduction according to Decree 15/2022/ND-CP.

✨  Accordingly, instructions for determining imported goods not eligible for VAT reduction include:

▪️ Goods have the product name mentioned in column 8 "product name" and a description of the product's content in column 9 "content" (in case there is no description of the content in column 9, then the product name mentioned in column 8 will applies) of Appendix I, part A of Appendix III;

▪️ Or goods in column 3 “goods” part B of Appendix III;

▪️ Or imported goods subject to excise tax in Appendix II promulgated together with Decree 15/2022/ND-CP.

▪️ Imported goods mentioned in Appendices I, II, III issued together with Decree 15/2022/ND-CP are not subject to VAT or subject to 5% VAT according to the provisions of the Law on VAT, comply with the provisions of the Law on VAT.

Summary of the list of goods and services not eligible for reduction under Decree 15/2022/ND-CP:

▪️ Groups of goods and services are not eligible for a 2% VAT reduction specified in Appendix I, products subject to excise tax in Appendix II and information technology products specified in Appendix  III Decree 15/2022/ND-CP:

1. Goods and services subject to excise tax

📌 Goods:

▪️ Cigarettes, cigars and other preparations from tobacco plants for smoking, inhalation, chewing, smelling, sucking;

▪️ Alcohol;

▪️ Beer;

▪️ Automobiles with less than 24 seats, including cars that carry both people and goods with two or more rows of seats, with a fixed partition design between the passenger compartment and the cargo compartment;

▪️ Two-wheeled motorcycles and three-wheeled motorcycles with a cylinder capacity of over 125cm3▪️ Two-wheeled motorcycles and three-wheeled motorcycles with a cylinder capacity of over 125cm3;

▪️ Aircraft, yachts;

▪️ Gasoline of all kinds;

▪️ Air conditioning capacity from 90,000 BTU or less;

▪️ Cards;

▪️ Votive paper

📌 Service:

▪️ Disco;

▪️ Massage, karaoke;

▪️ Casino; prize-winning electronic games, including games with the jackpot, slots, and similar machines;

▪️ Betting;

▪️ Golf includes selling membership cards, golf tickets;

▪️ Lottery.

2. IT products applied under IT law:

Instructions to look up products that are reduced or not eligible for VAT reduction:

👉 Step 1: List the products that the unit is producing, trading... The unit needs to list all the products that generate revenue, issue a value-added invoice.

👉 Step 2: Look up the products just made in decision No. 43/2018/QD-TTG dated November 1, 2018, record the corresponding product codes.

👉 Step 3: Compare the product codes just listed with the codes of goods and services specified in Appendix I, II, III of Decree No. 15/2022/ND-CP and compare the results.

▪️ If the code of goods and services is matched -> Enterprises are not entitled to incentives, issue a 10% VAT invoice

▪️ If the code of goods and services does not match -> Enterprises are given incentives, issue an 8% VAT invoice

⇒ If you have any questions, please register here for the earliest advice from TASCO or contact the hotline: 0975480868 (Zalo)

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