Vietnam to extend deadline of tax payments worth US$5.5 billion

The Ministry of Finance (MoF) is seeking public opinions over the extension of the deadline payment of taxes and land rental fees for businesses worth VND125.3 trillion (US$5.5 billion) in 2022.

Electronics production at Meiko Vietnam in Thach That Industrial Park, Hanoi. Photo: Le Nam

The application period for the extension is subject to value-added tax incurred from March to August 2022, estimated at around VND53.3-54.3 trillion ($2.33-2.37 billion).

Regarding corporate income tax, the MoF proposed the delay of the payment deadline for the first two quarters of 2022, which could go up to VND51-52 trillion ($2.23-2.27 billion).

The ministry also called for a delay of payment deadline of VAT and personal income tax for individuals and home businesses in 2022, or around VND15.3 trillion ($670 million) until December 31, 2022.

Under the Government’s Resolution No.126 on the elaboration of the Law on Tax Administration, the payment of rents for land and water surfaces is in two installments, with 50% on May 31 at the latest, and the remaining on October 31.

With the proposal, however, the deadline is now expected to be extended for another six more months after May 31, with the total delayed payment of around VND3.5-3.7 trillion ($153-162 million).

“Due to the emergency nature of the proposal to timely provide much-needed support for businesses and people affected by the pandemic, the MoF advises the resolution to take immediate effect after being signed,” it added.

As of present, the MoF has submitted a 50% cut in environmental protection tax on petroleum products, with the move being approved by the Standing Committee of the National Assembly on March 23.

From April 1 to the end of 2022, the tax rate for fuels would now be around VND2,000 per liter; diesel and mazut of VND1,000 per liter; and kerosene of VND700 per liter.

Taking into account a VAT reduction, the MoF estimates the cut would result in a decline of VND24 trillion ($1.05 billion) in state budget revenue.

As part of the upcoming socio-economic recovery program, the Government would also cut and waive taxes worth VND51.4 trillion ($2.24 billion).

Three years since the outbreak of the Covid-19 pandemic, the Government has issued supporting policies in terms of tax and fees reductions worth a combined of VND477.2 trillion ($20.9 billion), in which the businesses and people benefited from taxes and fees cut or waiver of VND134.4 trillion ($5.87 billion), and delay in payment of VND342.8 trillion ($15 billion).