Amended content of VAT regulations in Circular 13/2023/TT-BTC of the Ministry of Finance guiding Decree 49/2022/ND-CP

On February 28, 2023, the Minister of Finance issued Circular 13/2023/TT-BTC guiding Decree 49/2022/ND-CP dated July 29, 2022 of the Government amending Decree 209/2013/ND-CP guiding the Law on Value Added Tax (VAT) as amended by Decree 12/2015/ND-CP, Decree 100/2016/ND-CP and Decree 146/2017/ND-CP; and at the same time amending a number of points in Circular 80/2021/TT-BTC. Circular 13/2023/TT-BTC takes effect from April 14, 2023.

Circular 13/2023/TT-BTC has been issued guiding Decree 49/2022/ND-CP amending regulations on VAT.

Accordingly, amending a number of regulations on VAT, specifically:

Article 1 of Circular 13/2023/TT-BTC amends regulations on VAT in the following cases:

- For real estate transfer activities, the price for calculating value added tax is implemented according to the provisions of Clause 1, Article 1 of Decree 49/2022/ND-CP.

- The tax price for electricity production activities of Vietnam Electricity Group is implemented according to the provisions of Clause 1, Article 1 of Decree 49/2022/ND-CP.

- Business establishments are entitled to VAT refunds for investment projects according to the provisions of Clause 3, Article 1 of Decree 49/2022/ND-CP.

Guidance on VAT calculation prices for real estate transfer activities

Clause 1, Article 1 of Circular 13/2023/TT-BTC stipulates that for real estate transfer activities, the VAT calculation price is implemented according to the provisions of Clause 1, Article 1 of Decree 49/2022/ND-CP.

Accordingly, for real estate transfer activities, the tax calculation price is the real estate transfer price minus the land price deducted to calculate value added tax.

The land price deducted to calculate value added tax is specifically regulated as follows:

- In cases where the State allocates land for investment in infrastructure to build houses for sale, the land price deducted to calculate value added tax includes the land use fee payable to the state budget according to the provisions of law on land use fee collection and compensation and site clearance (if any).

- In cases of auctioning land use rights, the land price deducted to calculate value added tax is the winning auction price.

- In case of land lease for infrastructure construction, house construction for sale, the land price deducted for calculating value added tax is the land rent payable to the state budget according to the provisions of law on land rent, water surface rent and compensation, site clearance (if any).

The compensation, site clearance prescribed in Point a.1 and Point a.3 of this Clause is the compensation, site clearance amount according to the plan approved by the competent state agency, deducted from the land use fee, land rent payable according to the provisions of law on land use fee collection, land rent, water surface rent.

- In case the business establishment receives the transfer of land use rights from organizations and individuals, the land price deducted for calculating value added tax is the land price at the time of receiving the transfer of land use rights excluding the value of infrastructure.

The business establishment is allowed to declare and deduct input value added tax of infrastructure (if any). In case the land price at the time of receiving the transfer cannot be determined, the land price deducted for calculating value added tax is the land price prescribed by the People's Committee of the province or centrally run city at the time of signing the transfer contract.

In case the business establishment receiving the transfer of real estate from organizations and individuals has determined the land price including the infrastructure value according to the provisions in Point a, Clause 3, Article 4 of Decree 209/2013/ND-CP (amended and supplemented in Clause 3, Article 3 of Decree 12/2015/ND-CP), the land price deducted for calculating value added tax is the land price at the time of receiving the transfer excluding the infrastructure.

In case the infrastructure value at the time of receiving the transfer cannot be separated, the land price deducted for calculating value added tax is the land price prescribed by the People's Committee of the province or centrally run city at the time of signing the transfer contract.

- In case a business establishment receives capital contribution in the form of land use rights from an organization or individual, the land price deducted for calculating value added tax is the price stated in the capital contribution contract. In case the land use right transfer price is lower than the land price received as capital contribution, the land price shall only be deducted according to the transfer price.

- In case a real estate business establishment implements the form of build-transfer (BT) and pays by the value of land use rights, the land price deducted for calculating value added tax is the price at the time of signing the BT contract according to the provisions of law; if at the time of signing the BT contract, the price has not been determined, the land price deducted shall be the land price decided by the People's Committee of the province or centrally-run city to pay for the project.

In the case of construction, infrastructure business, house construction for sale, transfer or lease, the value added tax calculation price is the amount collected according to the project implementation progress or the collection progress stated in the contract minus the deductible land price corresponding to the percentage of the collected amount over the total contract value.

Circular 13/2023/TT-BTC amends and supplements Clause 13, Article 7 of Circular 219/2013/TT-BTC dated December 31, 2013 of the Ministry of Finance: Taxable price for electricity production activities of Vietnam Electricity Group shall be implemented according to the provisions of Clause 1, Article 1 of Decree 49/2022/ND-CP.

According to the provisions of Clause 1, Article 1 of Decree 49/2022/ND-CP, the tax calculation price for electricity production activities of Vietnam Electricity Group is as follows:

- For electricity of hydropower companies accounting under Vietnam Electricity Group, accounting under Power Generation Corporations, the VAT calculation price to determine the amount of VAT paid in the locality where the hydropower plant is located is calculated at 35% of the average retail electricity price excluding VAT according to the provisions of the Electricity Law and the Price Law.

- For electricity of thermal power companies accounting under Vietnam Electricity Group, accounting under Power Generation Corporations, the VAT calculation price to determine the amount of VAT paid in the locality where the thermal power plant is located is the electricity selling price to customers stated on the invoice according to the power purchase contract applicable to each thermal power plant.

In case there is no electricity purchase and sale contract applicable to each thermal power plant, the price for calculating value added tax is determined as the average retail price of electricity excluding value added tax according to the provisions of the electricity law and the price law.

- For electricity of power generation companies (except hydropower and thermal power) accounting dependent on the Vietnam Electricity Group, accounting dependent on the Power Generation Corporations, the price for calculating value added tax to determine the amount of value added tax paid in the locality where the power generation plant is located is the electricity selling price excluding value added tax prescribed by the competent state agency for each type of power generation.

In case there is no electricity selling price prescribed by the competent state agency for each type of power generation specified in Point 4, Article 1, Decree 49/2022/ND-CP, the price for calculating value added tax is determined as the average retail price of electricity excluding value added tax according to the provisions of the electricity law and the price law.

Circular 13 amends and supplements the provisions on VAT refund for investment projects of business establishments operating in conditional investment and business lines during the investment phase, according to the provisions of investment law and specialized laws that have been licensed under Clause 3, Article 1 of Decree 49/2022/ND-CP (replacing Clause 2 and Clause 3, Article 18 of Circular 219/2013/TT-BTC) with the following new content:

For investment projects of business establishments operating in conditional investment and business lines during the investment phase, according to the provisions of investment law and specialized laws that have been granted a business license by a competent state agency for conditional investment and business lines as prescribed in Clause 3, Article 1 of Decree 49/2022/ND-CP, the dossier includes: A copy of one of the following forms: License or certificate or document confirming or approving the business of the investment and business line with conditions.

The regulations on VAT refunds for investment projects of business establishments in conditional investment and business sectors shall be applied from the effective date of Decree No. 100/2016/ND-CP according to the provisions of Clause 2, Article 2 of Decree No. 49/2022/ND-CP of the Government.

In case the business establishment is subject to adjustment of VAT, late payment fees, and administrative fines for tax violations (if any) according to the provisions of Clause 2, Article 2 of Decree No. 49/2022/ND-CP, the adjustment shall be implemented as follows:

+ In case the tax authority has issued a decision to recover tax refunds, calculate late payment fees, and impose administrative fines for tax violations, the tax authority shall issue an adjustment decision according to Decision Form No. 38 issued together with Decree No. 118/2021/ND-CP. In case the business establishment has declared additional VAT refund, the business establishment and the tax authority shall follow Form No. 02/KTT issued with Circular No. 80/2021/TT-BTC of the Ministry of Finance to adjust the VAT refund and late payment amount. The amount of VAT that has been recovered and refunded (including cases where the business establishment has not offset the recovered and refunded VAT amount with the VAT payable arising from production and business activities and cases where the business establishment has offset the recovered and refunded VAT amount with the VAT payable arising from production and business activities), the amount of late payment, and administrative fines for tax violations (if any) paid to the state budget before April 14, 2023 shall be handled according to the provisions of Article 25 and Section 2, Chapter V of Circular No. 80.

+ The case of refunding the excess recovered and refunded VAT amount after handling the recovered and refunded VAT amount according to the provisions of this point shall be carried out from the VAT refund fund.

New guidance on VAT refund dossiers for investment projects of business establishments in conditional investment and business sectors

Article 2 of Circular 13/2023/TT-BTC stipulates amendments and supplements to Point a.4, Clause 2, Article 28 of Circular 80/2021/TT-BTC as follows:

“a.4) For investment projects of business establishments operating in conditional investment and business sectors during the investment phase, according to the provisions of investment law and specialized laws, which have been granted a business license for conditional investment and business sectors by a competent state agency as prescribed in Clause 3, Article 1 of Decree No. 49/2022/ND-CP dated July 29, 2022 of the Government: A copy of one of the following forms: License or certificate or document confirming or approving the business of conditional investment and business sectors.”

Thus, from April 14, 2023 (the effective date of Circular 13/2023/TT-BTC), the VAT refund dossier for investment projects of business establishments in conditional investment and business sectors in the investment phase eligible for VAT refund (stipulated in Clause 3, Article 1 of Decree 49/2022/ND-CP) includes the following documents:

(1) Request for refund of state budget revenue according to form No. 01/HT issued with Appendix I of Circular 80/2021/TT-BTC.

(2) Copy of Investment Registration Certificate or Investment Certificate or Investment License in cases where procedures for granting Investment Registration Certificate must be carried out.

(3) For projects with construction works: Copy of Land Use Right Certificate or Land Allocation Decision or Land Lease Contract of the competent authority; Construction Permit.

(4) Copy of Charter Capital Contribution Document.

(5) Copy of one of the following forms: License or Certificate or Confirmation or Approval of Conditional Business Investment Sectors and Trades.

(6) List of invoices and documents of purchased goods and services according to Form No. 01-1/HT issued with Appendix I of Circular 80/2021/TT-BTC, except for cases where the taxpayer has sent electronic invoices to the tax authority.

(7) Decision to establish a Project Management Board, Decision to assign investment project management by the investment project owner, Regulations on organization and operation of the branch or investment project management board (if the branch or project management board performs tax refund).

Source: baothanhhoa.vn