The Government has just issued Decree 64/2024/ND-CP dated June 17, 2024 (“Decree 64”) on extending the deadline for paying value added tax (VAT), corporate income tax (CIT), personal income tax (PIT) and land rent in 2024. This is a long-awaited decree by the business community and is expected to have a positive impact on production and business activities of enterprises.
1. Subjects to be extended
According to Article 3 of Decree 64, enterprises, organizations, households, business households, and individuals will enjoy incentives from this decree:
- Enterprises, organizations, households, business households, and individuals engaged in production activities in the following economic sectors:
- Agriculture, forestry and fisheries;
- Food production and processing; weaving; costume production; production of leather and related products; wood processing and production of products from wood, bamboo (except beds, cabinets, tables, chairs); manufacture of products from straw and plaiting materials; production of paper and paper products; manufacturing products from rubber and plastic; production of products from other non-metallic minerals; metal production; mechanical processing; metal treatment and coating; manufacturing electronic products, computers and optical products; manufacture of automobiles and other motor vehicles; production of beds, cabinets, tables, chairs;
- Construction;
- Publishing activities; cinematographic activities, television program production, recording and music publishing;
- Exploiting crude oil and natural gas (no extension for corporate income tax on crude oil, condensate, and natural gas collected under agreements and contracts);
- Beverage production; print and copy records of all kinds; production of coke and refined petroleum products; production of chemicals and chemical products; manufacturing products from prefabricated metal (except machinery and equipment); production of motorbikes and motorbikes; repair, maintenance and installation of machinery and equipment;
- Drainage and wastewater treatment.
- Enterprises, organizations, households, business households, and individuals doing business in the following economic sectors:
- Transportation and warehousing; Accommodation and food services; education and training; health and social assistance activities; real estate business activities;
- Labor and employment service activities; activities of travel agents, tour businesses and support services related to promotion and organization of tours;
- Creative, artistic and entertainment activities; operations of libraries, archives, museums and other cultural activities; sports and entertainment activities; movie screening activities;
- Radio and television broadcasting activities; computer programming, consulting services and other activities related to computers; information service activities;
- Mining support service activities.
- Enterprises, organizations, households, business households, and individuals engaged in manufacturing supporting industrial products are given priority for development; key mechanical products.
- Small and micro enterprises.[1]
2. Extension of tax payment deadline
| Subjects | Tax obligations |
|
Enterprises |
For CIT: enterprises and organizations are entitled to an extension of the deadline for temporary payment of CIT for second quarter under the CIT period of 2024 period within 3 months of the end of the CIT payment deadline.[2] |
| For VAT (except for VAT upon imports): enterprises and organizations are entitled to an extension of the tax payment deadline for the VAT amounts payable (including the tax amount allocated to other provincial-level localities where the taxpayer is headquartered, the tax amount to be paid in each occurrence) of the tax period from May to September 2024 (for the case of monthly VAT declaration) and the tax period of the first and second quarters of 2024(for the case of quarterly VAT declaration).[3]
The extension of payment of CIT and VAT also applies to branches or affiliates of the enterprise, unless those branches and affiliates do not conduct production and business activities in the extended economic sector or field.[4] |
|
| Business households and individuals | VAT, PIT: business households and individuals are entitled to an extension of the deadline for payment of VAT and PIT for the tax amounts accrued in 2024 no later than December 30, 2024.[5] |
3. Extension of the time limit for paying land rent
The extension of the time limit for payment of 50% of the land rent payable in 2024 (amount payable for the second period in 2024) by enterprises, organizations, households, and business households who are directly renting land from the State under a decision or contract signed by or with a competent state agency in the form of annual land rental payment for the period of 2 months from October 31, 2024.[6]
4. Deadline for submission of the request for the extension of land tax and rent payment
Taxpayer must directly declare and submit an application for extension of tax payment and land rent to the directly managing tax agency once for the entire amount of tax and land rent arising in the same extended tax periods at the same time of filing monthly (or quarterly) tax returns. Applications may be submitted by electronic means; sending a paper copy to the tax office or via postal service. In case the extension request is not submitted at the same time as the monthly (or quarterly) tax declaration submission, the deadline for submission is September 30, 2024. If submitted after this time, the taxpayer will not be allowed for extension of tax and land rent payment deadlines.[7]
The policy to extend tax and land rent payment deadlines will contribute to providing timely support to enterprises and people facing difficulties through reducing financial costs, supporting liquidity and cash flow, thereby, creating conditions for enterprises and people to focus capital on production and business, and promoting economic recovery and development.
[1] Law on Support for Small and Medium Enterprises 2017 and Decree No. 80/2021/ND-CP dated August 26, 2021 of the Government detailing a number of articles of the Law on Support for Small and Medium Enterprises.
[2] Article 4.2a of Decree 64
[3] Article 4.1a of Decree 64
[4] Articles 4.1b, 4.2b of Decree 64
[5] Article 4.3 of Decree 64
[6] Article 4.4 of Decree 64
[7] Article 5.1 of Decree 64
