The government is considering reducing a range of taxes and fees due to Covid-19.
Instead of just tax deferrals, businesses and individuals facing difficulties due to Covid-19 may receive reductions in environmental tax, corporate income tax, VAT, registration fees, and more.
According to the draft Resolution on tasks and solutions to overcome difficulties in production, business, and disbursement of public investment capital, which is currently being reviewed by the Ministry of Planning and Investment, there will be additional fiscal solutions regarding the exemption and reduction of various taxes and fees for businesses and individuals. These solutions, once finalized by the Government, will be submitted for approval to the Standing Committee of the National Assembly and the National Assembly.
Registration fees for domestically manufactured or assembled automobiles will be reduced by 50% until the end of 2020; corporate income tax for small and medium-sized enterprises will be reduced by 50% in 2020; and the VAT rate (currently 10%) for goods, services, and input materials will be reduced by 50%.
Additionally, consideration will be given to refunding VAT for 2020 for certain sectors severely and directly affected by Covid-19, such as aviation and tourism; reducing toll fees, port fees, road maintenance fees, and aviation service fees (parking fees, takeoff and landing fees, air traffic control fees, security screening fees, ground handling fees, etc.).
A number of businesses on Chua Boc Street (Hanoi) have had to temporarily close due to Covid-19.Photo: Ngoc Thanh
The Ministry of Finance will study extending the deadline for paying corporate income tax for 2019, value-added tax, personal income tax, and land rent to one year instead of five months. Business households affected by Covid-19 will be granted extensions and deferrals for lump-sum tax payments, similar to businesses; and will be exempt from 100% of business license fees for 2020...
In addition, the Government will provide input to the Standing Committee of the National Assembly and the National Assembly in April regarding the reduction of environmental protection tax on input fuels, especially E5 RON92 bioethanol.
The Ministry of Industry and Trade previously raised the issue of reducing the environmental protection tax on gasoline in a report submitted to the Government in early April. Currently, the environmental tax is 3,800 VND per liter for E5 RON92 gasoline and 4,000 VND for RON95 gasoline. The agency also suggested that, instead of a mechanical tax, the environmental protection tax on E5 RON92 gasoline should be based on emission levels (75-80% of the tax on conventional gasoline).
In addition, the government may waive or reduce fees and charges, such as fees for assessing and granting licenses for water resource exploitation and use, meteorological and hydrological data exploitation, banking licenses, construction project appraisal, and fees for issuing construction practice certificates to individuals.
The agency will also report to the Government on proposals to reduce import taxes on pork, postpone partial payment of export taxes for 5 months (until the end of the second quarter), and make temporary adjustments to tax rates in certain sectors such as import taxes on aviation fuel...
Previously, starting from April 8th, people and businesses facing difficulties due to Covid-19 were granted extensions and deferrals of tax and land rent payments according to a Government Resolution. According to estimates by the Ministry of Finance, the amount of tax and land rent deferred reached 180,000 billion VND, and 98% of businesses would be eligible for this policy.
