In order to boost the recovery and development of the local economy, the Vietnamese government recently announced that the Value Added Tax (VAT) rate of all categories of goods and services currently subject to a 10% VAT rate will be reduced from 10% to 8% during the period from 1 July 2023 to 31 December 2023.

The Vietnamese government had reduced the VAT rate in 2022 as well, which expired on 31December 2022. Similar to Decree 15/2022/ND-CP issued in 2022, the VAT rate reduction in 2023 does not include the following categories of goods and services:

1. Telecommunications services, information technology goods and services;
2. Finance, banking, insurance, securities;
3. Trading of real estate;
4. Metal and precast metal products, mining products (excluding coal), cokes, refined petroleum, chemical products; and
5. Goods and services subject to special sales tax. For example, tobacco products, beer, cars, massage, lotteries, etc.

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