This Circular guides the reduction of VAT by 50% for foodstuffs, fresh agricultural products, and fresh fruits produced domestically. It applies to trading enterprises calculating VAT under the deduction method.
Scope of application
Trading enterprises
Key points
- Foodstuffs, fresh agricultural products, and fresh fruits are subject to a 50% reduction in VAT rates (Article 1).
- The amount of reduced VAT is calculated directly on the sales invoices issued by the enterprise (Point 3).
- Enterprises purchasing goods from processing, import-export enterprises that are not eligible for reduced VAT (Article 4).
- This Circular takes effect from February 1, 1999, until July 31, 1999.
- Trading companies must correctly determine the 50% reduced VAT rate on their invoices when selling goods (Example in the Circular).
🌐 Social impact of this document
- Reducing the financial burden on enterprises dealing in foodstuffs and fresh agricultural products.
- Enhancing the competitiveness of domestic products compared to imported goods.
- Difficulties in determining and applying the 50% reduced VAT rate for specific items.
❓ Frequently asked questions
Which goods are eligible for reduced VAT?
Foodstuffs, fresh agricultural products, and fresh fruits produced domestically (Article 1).
What is the extent of the VAT reduction?
50% of the prescribed VAT rate (Point 3).
Which enterprises are eligible for this benefit?
Trading enterprises calculating VAT under the deduction method (Article 2).
When does this Circular expire?
On July 31, 1999.
Full text
| MINISTRY OF FINANCE |
SOCIALIST REPUBLIC OF VIET NAM Independence - Freedom - Happiness |
|
Number: 11/1999/TT-BTC |
Hanoi, January 29, 1999 |
CIRCULAR
Guidelines for implementing Decision No. 05/1999/QĐ-TTg dated January 23, 1999 of the Prime Minister on reducing value-added tax for the sale of fresh foodstuffs and fruits and vegetables.
Reducing value-added tax for the sale of fresh foodstuffs and fruits and vegetables.
goods consisting of fresh foodstuffs and fresh fruits and vegetables.
Pursuant to the Law on Value-Added Tax No. 02/1997/QH9 dated May 10, 1997 and Decrees No. 28/1998/NĐ-CP dated May 11, 1998 and No. 102/1998/NĐ-CP dated December 21, 1998 of the Government detailing the implementation of the Law on Value-Added Tax.
Pursuant to Circulars No. 89/1998/TT-BTC dated June 27, 1998, No. 175/1998/TT-BTC dated December 24, 1998, and No. 187/1998/TT-BTC dated December 29, 1998 of the Ministry of Finance guiding the implementation of the Law on Value-Added Tax.
Pursuant to Clause 2 and 3, Article 1 of Decision No. 05/1999/QĐ-TTg dated January 23, 1999 of the Prime Minister on reducing value-added tax for the sale of fresh foodstuffs and fruits and vegetables.
The Ministry of Finance hereby provides guidance as follows:
1. The taxable objects subject to a 50% reduction in value-added tax are fresh foodstuffs and fruits and vegetables produced, cultivated, or caught domestically, specifically:
a) Food grains including: rice, corn, potatoes, cassava.
b) Fresh live food products including: various types of pigs, chickens, ducks, geese... not yet slaughtered; various types of beef, pork, chicken, duck meat; various types of aquatic and marine products.
c) Fresh fruits and vegetables (excluding fresh flowers).
2. The taxpayers eligible for a 50% reduction in value-added tax are commercial enterprises calculating value-added tax under the deduction method.
3. The 50% reduction in value-added tax stipulated in point 1 above shall be calculated and determined directly on the value-added tax invoice for goods sold.
Example: Company A purchases paddy and sells it at a price excluding value-added tax of 2,400 VND/kg.
The rate of value-added tax for the sale of food grains is 5%, reduced by 50%.
The output value-added tax is calculated as: 2,400 VND/kg x 5% x 50% = 60 VND/kg.
The payment price (including value-added tax) on the invoice is: 2,460 VND/kg.
4. Commercial enterprises purchasing fresh foodstuffs from processing enterprises or import-export enterprises with value-added tax invoices, where the input value-added tax can be deducted when the goods are sold, are not subject to the reduction in value-added tax as provided in point 1 of this Circular.
This Circular takes effect from February 1, 1999 until July 31, 1999. Any difficulties encountered during implementation should be promptly reported to the Ministry of Finance for study and resolution./.
|
Pham Van Trong (Signed) |
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