THE MINISTRY OF FINANCE
THE GENERAL DEPARTMENT OF TAXATION
-------
SOCIALIST REPUBLIC OF VIET NAM
Independence - Freedom – Happiness
---------
No. 1579/TCT/PCCS
Hanoi, May 26, 2005
 
OFFICIAL LETTER
ON VALUE ADDED TAX
To : Provincial/municipal Tax Departments
The General Department of Taxation has received official letters from several enterprises, inquiring about value added tax (VAT) on the garbage-collecting and -transporting service. Concerning this matter, the General Department of Taxation gives the following opinion:
Point 2 of the Finance Ministry's Circular No. 84/2004/TT-BTC of August 18, 2004, amending and supplementing Circular No. 120/2003/TT-BTC of December 12, 2003, which guides the implementation of the Government's Decree No. 158/2003/ND-CP of December 10, 2003, detailing the implementation of the VAT Law and the Law Amending and Supplementing a Number of Articles of the VAT Law, guides as follows:
"2. Point 14, Section II of Part A regarding objects not subject to VAT on public sanitation services is amended and supplemented as follows:
14. Public services such as street cleaning and water drainage include activities of collecting, clearing and treating garbage and waste matters, draining water and treating wastewater for organizations and individuals, regardless of their sources of payment. If business establishments use waste matters for production of other products for sale, such products shall not be subject to VAT as guided in Section II, Part A of Circular No. 120/2003/TT-BTC, or be subject to VAT as guided in Section II, Part B of Circular No. 120/2003/TT-BTC. Where business establishments provide such services as cleaning offices of organizations or individuals, such services shall be subject to VAT at the rate of 10% as guided at Point 3.27, Section II, Part B of Circular No. 120/2003/TT-BTC…"

>> See also:  Circular No. 43/1999/TT-BTC guiding the implementation of the law on value added tax (VAT) for foreign diplomatic missions, consulates and representative offices of international organizations

According to the above-said guidance, the garbage-collecting and -transporting service provided to organizations or individuals regardless of their sources of payment is a public sanitation service, so it is not subject to VAT; the service of cleaning offices of organizations or individuals shall be subject to the VAT rate of 10%.
The General Department of Taxation hereby notifies provincial/municipal Tax Departments thereof for providing guidance to enterprises for implementation.
 

 

 
FOR THE GENERAL DIRECTOR OF TAXATION
DEPUTY GENERAL DIRECTOR



Pham Duy Khuong