The 2012 worldwide VAT, GST and sales tax guide

V IETNAM 709
Some goods and services are exempt from VAT.
The standard rate of 10% applies to goods and services that are
not specifically included in the list of goods and services subject
to the 0% or 5% rates and the list of exempt goods. Goods and
services taxable at the standard rate include, but are not limited
to, the following:
• Power generation
• Electrical products
• Processed foodstuffs
• Construction and installation
• Outgoing postal services
The 5% rate applies to the supply of essential goods and services.
Goods and services taxable at the 5% rate include, but are not
limited to, the following:
• Water
• Fertilizer
• Medicine and medical equipment
• Teaching tools
• Agricultural products
The zero rate applies to exported goods and services, including
goods and services supplied to entities located in tax-free zones
and exported goods and services that are not subject to VAT when
supplied in Vietnam. The zero rate does not apply to certain supplies,
including reinsurance services involving foreign insurers,
financial derivatives and outgoing postal and telecommunication
services.
The following table provides examples of goods and services that
are exempt from VAT (this list is not exhaustive).
Examples of exempt supplies of goods and services
Raw agricultural products
Livestock
Aircraft, oil rigs and ships that are not yet locally produced and
that are leased from overseas
Land-use rights
Credit activities, credit guarantees, financial leases and financial
derivative services
Capital transfers
Securities transfers
Life insurance services
Medical services
Education and vocational training
Publication of newspapers, magazines and certain kinds of books
Public transportation by bus and electric car
Reinsurance services
Technology transfers
Public sewage services
Foreign-currency trading (effective from 1 March 2012)
Debt transfers (effective from 1 March 2012)
Credit card issuance (effective from 1 March 2012)
Factoring (effective from 1 March 2012)