On September 13th, 2024, the General Department of Taxation issued Official Letter No. 4062/TCT-CS, which contains several notable contents as follows:
Regulations on tax exemption, reduction, extension, and tax policies for taxpayers affected by natural disasters for the following contents:
1. On tax payment extension: Article 24 of Circular No. 80/2021/TT-BTC dated September 29th, 2021 of the Ministry of Finance, provides guidance on the implementation of several articles of the Law on Tax Administration and Decree No. 126/2020/ND-CP dated October 19th, 2020 of the Government, regarding the order and procedures for tax payment extension.
2. On late payment interest exemption: Article 23 of Circular No. 80/2021/TT-BTC dated September 29th, 2021 of the Ministry of Finance, provides guidance on the implementation of several articles of the Law on Tax Administration and Decree No. 126/2020/ND-CP dated October 19th, 2020 of the Government guiding the order and procedures for late payment interest exemption.
3. Exemption from administrative penalties for tax administration: Clause 1, Article 140 of the Law on Tax Administration No. 38/2019/QH14 dated June 13th, 2019, regarding the exemption from administrative penalties for tax administration violations for: “Taxpayers who are fined for administrative violations of tax administration and suffer damage in cases of force majeure specified in Clause 27, Article 3 of this Law, shall be exempted from fines. The total amount of exempted fines shall not exceed the value of damaged assets and goods.”
4. On VAT deduction: Clause 1, Article 14 of Circular No. 219/2013/TT-BTC dated December 31st, 2013, of the Ministry of Finance, provides guidance on the principle of input VAT deduction as follows: “Input VAT on goods and services used for the production and trading of VAT-taxable goods and services is fully deductible, including input VAT on non-compensated VAT-taxable goods that have been damaged. Cases of non-compensated loss for which input VAT is deductible include: natural disasters, fires, cases of loss not covered by insurance, goods that have deteriorated in quality, or goods expired and required to be destroyed. The business establishments must have complete documentation and evidence to substantiate cases of non-compensated loss for tax deduction.”
5. On corporate income tax: According to Article 9 of the Corporate Income Tax Law and documents guiding its implementation: “Enterprises are included in deductible expenses when determining income subject to CIT for the following expenses if they meet the conditions in Clause 1, Article 9 of the CIT Law:
– The value of losses due to natural disasters, epidemics, and other force majeure events that are not compensated (Point a, Clause 2, Article 9 of the CIT Law). The value of losses due to natural disasters, epidemics, fires, and other force majeure events that are not compensated is determined by the total value of the loss minus (-) the value that the insurance company or other organizations and individuals are required to compensate according to the provisions of law.”
6. On special consumption tax reduction: Article 9 of the Special Consumption Tax Law No. 27/2008/QH12 dated November 14th, 2008 stipulates the reduction of Special Consumption Tax as follows:
“Taxpayers producing goods subject to special consumption tax, who encounter difficulties due to natural disasters or unexpected accidents, are eligible for tax reductions.
The tax reduction level is determined based on the actual losses incurred from natural disasters or unexpected accidents, but not exceeding 30% of the tax payable in the year of the damage occurred, and not exceeding the value of the damaged assets after compensation (if any).”
7. On resource tax exemption and reduction: Article 56 of Circular No. 80/2021/TT-BTC dated September 29th, 2021 of the Ministry of Finance provides guidance on the implementation of a number of articles of the Law on Tax Administration and Decree No. 126/2020/ND-CP dated October 19th, 2020 of the Government provides guidance on the procedures and dossiers for exemption and reduction of tax on resource tax due to natural disasters.
8. On non-agricultural land use tax exemption and reduction: Article 57 of Circular No. 80/2021/TT-BTC dated September 29th, 2021 of the Ministry of Finance provides guidance on the implementation of a number of articles of the Law on Tax Administration and Decree No. 126/2020/ND-CP dated October 19th, 2020 of the Government provides guidance on the procedures and dossiers for exemption and reduction non-agricultural land use tax.
