On August 1, 2024, the General Department of Taxation issued Official Letter No. 3390/TCT-CS in response to the Gia Lai Provincial Tax Department regarding the VAT policy applicable to the transfer of Voluntary Emission Reduction (VER) certificates ("Official Letter 3390").
VER is described as a credit under the Gold Standard—a body that created and implements the Gold Standard for global goals. The Gold Standard is a benchmark for quantifying and certifying impacts related to climate security and sustainable development goals. The unit of measurement for emission reductions under the Gold Standard program is the VER, with 1 VER equivalent to 1 ton of CO2. Thus, the measurement unit for VER certificates is similar to that of CERs certificates.
According to Clause 3, Article 2 of Decision No. 130/2007/QĐ-TTg, CERs certificates are certified greenhouse gas emission reduction certificates issued by the international CDM Executive Board for CDM projects. 1 CER is equivalent to one ton of CO2.
Therefore, although the measurement units are the same, this certificate is not yet officially recognized in any legal document and is not identified as a CERs certificate.
As such, Official Letter 3390 determines that the transfer of VER certificates is not exempt from VAT declaration and payment under the provisions of Article 2.3.a of Decree No. 209/2013/ND-CP guiding the Law on Value Added Tax.
Consequently, enterprises involved in the transfer of certificates/credits that are not CERs must declare VAT at the rate of 10% as prescribed.
Comment: