Vietnam Value Added Tax (VAT) Rates

VAT applies to goods and services used for production, trading and consumption in Vietnam (including goods and services purchased from non-residents). A domestic business must charge VAT on the value of goods or services supplied.

In addition, VAT applies on the dutiable value of imported goods. The importer must pay VAT to the customs authorities at the same time they pay import duties. For imported services, VAT is levied via the FCT mechanism.

VAT payable is calculated as the output VAT charged to customers less the input VAT suffered on purchases of goods and services. For input VAT to be creditable, the taxpayer must obtain a proper VAT invoice from the supplier. For VAT paid on imports, the supporting document is the tax payment voucher, and for VAT collected via the FCT mechanism, the supporting document is the FCT payment voucher.

Related: Tax Accounting Services

The general rate of VAT in Vietnam which applies to goods and services is 10%. A reduced rate of 5% also applies to certain goods and services.

Other than Value Added Tax, Vietnam also levies a Special Sales Tax (SCT) which is applicable to goods and services classified as luxury. The rates are from 10% to 70% for SCT (refer to ‘Special Sales Tax’ section above).

The VAT rate is calculated based on the selling price (exclusive of tax).

Taxable transactions – VAT and Special Consumption Tax (SCT) are levied on the sale of goods and the provision of services.

Registration

All organizations and individuals carrying on the production or trading of taxable goods and services in Vietnam must register for VAT.

Each branch or outlet of an enterprise must register separately and declare tax on its own activities. Transfers of goods between branches may be subject to VAT.

Registration for tax payment is required within 10 days of a corporation’s establishment date. VAT payable by a corporation is calculated by the tax credit method or calculated directly on the basis of added value.

Filing and payment – Monthly filing and payment of outstanding VAT must be made on or before the 20th of the following month.

Source: Gov.vn