GUIDELINES ON TAX REFUND FOR BUSINESS ESTABLISHMENTS HAVING THEIR VALUE-ADDED TAX OF INVESTMENT PROJECTS REVOKED

On July 29, 2022, the Government issued Decree No. 49/2022/ND-CP (“Decree 49”) amending and supplementing a number of articles of Decree No. 209/2013/ND-CP guiding on the implementation of the Law on Value Added Tax (“VAT”).

Accordingly, Decree 49 expands the scope of investment projects eligible for VAT refund, allowing business establishments (including newly established business establishments from investment projects), which have new investment projects (including investment projects divided into several investment phases or investment categories) in areas of the same or different provinces and cities where their headquarters are located, that are in the investment phase or projects on prospection and projects to search, prospect, and develop oil and gas fields that are in the investment phase, and have the input VAT of goods and services incurred during the cumulative investment phase that have not been fully deducted from at least 300 million VND, shall be eligible for the VAT refund. The implementation of this regulation has been carried out since the effective date of Decree 100/2016/ND-CP (July 1, 2016). The detailed content of Decree 49 has been updated by ATA Legal Services here.

Recently, on February 28, 2023, the Minister of Finance issued Circular No. 13/2023/TT-BTC ("Circular 13") setting out a number of application guidelines of Decree 49, including instructions on procedures for adjusting VAT, deferral amount, and fines for administrative violations of tax and tax refund for business establishments having their VAT amount of investment projects revoked, specifically as follows:

1. In case the tax authority has issued a revocation decision of refuned tax amount, has charged late payment and has imposed sanction for administrative violations on tax: The tax authority shall issue a decision to amend, supplement or revoke a part of the sanction decision.
2. In case the business establishment has made additional declaration on VAT refund: The business establishment and the tax authority shall make a Minutes on the explanation and supplementation of information and documents to adjust the VAT refund or late payment amount.
3. The amount of VAT refund, late payment, fine for administrative violations of tax (if any) paid into the state budget before April 14, 2023 shall be settled in accordance with the Law on Tax Administration.
4. The refund of the overpaid VAT amount is made from VAT refund funds.

Circular 13 shall take effect from April 14, 2023.