Vietnam parliament approves extension of VAT cut until end-2026

[HANOI] Vietnam’s National Assembly, the country’s lawmaking body, on Tuesday passed a resolution to extend a cut in the value-added tax rate until the end of next year, state media reported.

Vietnam cut its VAT rate to 8 per cent from 10 per cent in early 2022 to support the economy after the Covid-19 pandemic, and has since extended it a number of times.

The lowered rate applies to most goods and services, with exceptions for telecommunication, financial, insurance, real estate and stock trading services and metal products, Vietnam News Agency reported.

The tax cut will cost 121.74 trillion dong (S$6 billion) in foregone revenue from July to the end of next year, the report cited a Finance Ministry report as saying.

US President Donald Trump said earlier this year that value-added taxes in other countries carried a lot of blame for America’s trade deficit. REUTERS