ATAX Auditing and Tax Consulting Co., Ltd. is pleased to send you the Newsletter for May 2025.

This month's ATAX Newsletter covers:

• Open letter from Regional Tax Sub-department II on e-invoices generated from cash registers
• Regional Tax Sub-department IX introduces key changes in the VAT Law
• Selected official letters issued in May 2025

Open letter from Regional Tax Sub-department II on e-invoices generated from cash registers

To: Enterprises

Pursuant to Tax Administration Law No. 38/2019/QH14 dated 13 June 2019 and its guiding documents;

Pursuant to Enterprise Law No. 59/2020/QH14 dated 17 June 2020 and its guiding documents;

The Government recently issued Decree No. 70/2025/ND-CP dated 20 March 2025 amending and supplementing several articles of Decree No. 123/2020/ND-CP dated 19 October 2020 on invoices and documents. The Decree takes effect from 1 June 2025 and requires enterprises to use e-invoices generated from cash registers for "sales of goods and services, including direct sales to consumers (shopping malls; supermarkets; retail (except cars, motorcycles and other motor vehicles); food and beverage; restaurants; hotels; passenger transport services, services directly supporting road transport, arts, recreation and entertainment services, cinema, and other personal services under the Vietnam Standard Industrial Classification)". On 17 April 2025, Regional Tax Sub-department II sent an open letter on implementing cash-register e-invoices under Decree 70/2025/ND-CP to enterprises in Ho Chi Minh City.

On that basis, Regional Tax Sub-department II informs enterprises of the following support and push for cash-register e-invoices:

• Enterprises required to use cash-register e-invoices under Decree 70/2025/ND-CP but which do not yet have a cash register because they do not meet the IT infrastructure requirements or lack an invoicing solution should contact e-invoice solution and transmission providers for support and advice on solutions and IT infrastructure (list attached). For questions on the rules for cash-register e-invoices, enterprises may contact their assigned support officer (as notified previously by the Sub-department) or Enterprise Management and Support Division No. 4 at 028-37702288 (ext. 6804).
• Where actual business lines have changed (no longer matching the lines registered under the Vietnam Standard Industrial Classification), so that the enterprise is not required to use cash-register e-invoices under Decree 70/2025/ND-CP, enterprises should review and update their actual business lines. The Sub-department will then determine that cash-register e-invoices are not required.

From the date of this letter, enterprises that are required to use cash-register e-invoices under Decree 70/2025/ND-CP but do not switch will be considered to have violated invoice rules (failing to issue invoices when selling goods or providing services) and may face action on their business registration for violating tax and invoice laws.

Regional Tax Sub-department IX introduces key changes in the VAT Law

To: Taxpayers in Son La, Dien Bien and Lai Chau provinces; divisions and tax teams under Regional Tax Sub-department IX.

On 26 November 2024, the National Assembly adopted VAT Law No. 48/2024/QH15. Key new points include:

1. Provisions effective from 1 July 2025

1.1. Changes to non-taxable items

Article 5 of the 2024 VAT Law adjusts the non-taxable items under Article 5 of the 2008 VAT Law:

• Removes several non-taxable items under the 2008 VAT Law, including: fertilizers; specialized machinery and equipment for agricultural production; offshore fishing vessels; securities depository; market organization services of stock exchanges or securities trading centres; other securities business activities.
• Exported products made from extracted natural resources and minerals that are processed into other products are non-taxable according to a list set by the Government. (Under the 2008 Law, exported products processed from resources and minerals whose resource and mineral value plus energy costs account for 51% or more of the product cost were non-taxable.)
• Adds imported goods donated or sponsored for natural disaster, catastrophe, epidemic and war relief, as prescribed by the Government, to the non-taxable list.

1.2. Taxable price of imported goods

• 2008 VAT Law: the taxable price of imported goods was the border-gate import price plus import duty (if any), special consumption tax (if any) and environmental protection tax (if any).
• 2024 VAT Law (Article 7): the taxable price is the customs value for import duty purposes under the law on export and import duties, plus import duty, plus any additional import duties (if any), plus special consumption tax (if any) and environmental protection tax (if any).

1.3. Taxable price of promotional goods and services: Article 7 of the 2024 VAT Law provides that the taxable price of goods and services used for promotion under commercial law is zero.

1.4. Changes in VAT rates

1.4.1. From non-taxable to 5%: fertilizers; fishing vessels operating at sea.

1.4.2. From 5% to 10%: unprocessed forest products; sugar and by-products of sugar production (molasses, bagasse, filter mud); specialized equipment and instruments for teaching, research and scientific experiments; cultural activities, exhibitions, physical training and sports; performing arts; film production; film import, distribution and screening.

1.5. New items subject to the 0% rate (clause 1, Article 9): international transport; construction and installation works overseas or in non-tariff zones; goods sold in transit areas to individuals (foreigners or Vietnamese) who have completed exit procedures; goods sold at duty-free shops; export services including leasing of means of transport used outside Vietnam and aviation and maritime services supplied directly or through agents for international transport.

1.6. Changes to input VAT deduction conditions

1.6.1. Purchases below VND 20 million now require non-cash payment documents:

• 2008 VAT Law: single purchases below VND 20 million did not require non-cash payment documents for VAT deduction.
• 2024 VAT Law (clause 2, Article 14): all purchases must have non-cash payment documents, except certain special cases prescribed by the Government.

1.6.2. Additional supporting documents: for exported goods and services, packing lists, bills of lading and cargo insurance documents (if any) are added to the conditions for input VAT deduction, except certain special cases prescribed by the Government.

1.7. New VAT refund case: under clause 3, Article 15, a business that only produces goods or provides services subject to the 5% rate is entitled to a VAT refund if its undeducted input VAT is VND 300 million or more after 12 consecutive months or 04 consecutive quarters.

2. Provision effective from 1 January 2026

Goods and services of households and individuals with annual revenue of VND 200 million or less are not subject to VAT.

For questions, taxpayers may contact Regional Tax Sub-department IX (Son La: Enterprise Management and Support Division, tel. 02123 752 289; Individual, Household Business and Other Revenue Division, tel. 02123 751 985; Dien Bien: tel. 02153 834 343; Lai Chau: tel. 02136 299 299).

Selected official letters issued in May 2025: