Công văn số 10175/BTC-CST về việc thuế suất thuế GTGT do Bộ Tài chính ban hành

To: Vietnam-Japan Mixed Transportation Joint-Venture Company No. 1
(104 Thai Thinh street, Dong Da district, Hanoi)

The Ministry of Finance received Official Letter No. 546/CV-CT of June 21, 2007, from Vietnam-Japan Mixed Transportation Joint-Venture Company No. 1, requesting the guidance on value-added tax (VAT) rates of a number of services provided to export-processing enterprises. Concerning this issue, the Ministry of Finance gives the following opinions:

Point 1, Section II, Part B of the Finance Ministry’s Circular No. 32/2007/TT-BTC of April 9, 2007, guiding the implementation of the  Government’s Decree No. 158/2003/ND-CP of December 10, 2003, Decree No. 148/2004/ND-CP of July 23, 2004, and Decree No. 156/2005/ND-CP of December 5, 2005, detailing the implementation of the VAT Law and the Law Amending and Supplementing a number of Articles of the VAT Law, stipulates: Exported goods and services..., Exported services and services provided to export-processing enterprises for their production and business activities, excluding services for personal consumption (such as transportation of workers, supply of food rations for workers of export-processing enterprises, etc.), are subject to the VAT rate of 0%.

Actually, the expense for transportation of workers of export-processing enterprises and the expense for lease of apartments for officers working for these enterprises constitute part of salary expenses which the enterprises have to pay to laborers under labor contracts, instead of paying money to laborers while laborers paying by themselves expenses for travel and accommodation. Therefore, these expenses are accounted as reasonable expenses in the determination of taxable incomes.

So, based on the above guidance, if the Company provides services of: transportation of workers of export-processing enterprises and lease of apartments to Japanese officers (working in export-processing enterprises) (regardless of whether it signs contracts with individuals or export-processing enterprises), these services are not subject to the VAT rate of 0%. The Company shall declare and pay VAT at the rate of 5% for the transportation service, and 10% for the lease service.

The Ministry of Finance gives the above reply to the Company for information and compliance.

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