THE MINISTRY OF FINANCE
THE GENERAL DEPARTMENT OF TAXATION

Official Dispatch No. 488/TCT-CS dated February 05, 2013 of the General Department of Taxation Concerning value-added tax and enterprise income tax on discounts
To:
- The Department of Taxation of Hanoi;
- Panasonic Vietnam Co., Ltd.
(Address: Block J1-J2, Thang Long Industrial Park, Dong Anh, Hanoi)
The General Department of Taxation received the Official Dispatch No. 129-12/PVN dated November 13th 2012, the Official Dispatch No. 81-12/CV-PV dated August 13th 2012, and the Official Dispatch No. 19-12/CV-PV dated May 02nd 2012 of Panasonic Vietnam Co., Ltd (PVN), enquiring about the value-added tax and enterprise income tax on discounts, and the Official Dispatch No. 13047/CT-TTr3 dated May 31st 2012 of the Department of Taxation of Hanoi (DTH), reporting the settlement of tax of PVN. After obtaining opinions from units affiliated to the Ministry of Finance and sending reports to the Ministry of Finance, the General Department of Taxation hereby gives its opinions about this issue as follows:
- Point 1.1 Section VIII of the Circular No. 161/2007/TT-BTC dated December 31st 2007 of the Ministry of Finance, guiding the implementation of 16 Accounting standards, promulgated in the Decision No. 149/2001/QĐ-BTC dated December 31st 2001, the Decision No. 165/2002/QĐ-BTC dated December 31st 2002, and the Decision No. 234/2003/QĐ-BTC dated December 30th 2003 of the Minister of Finance specifies that:
“1.1. Revenue accounting:
The revenue derived from transactions and events are determined under agreements between the enterprise and the seller or the user. It is equal to the reasonable value of the amounts that have been or will be collected, after deducting the trade discounts, price reductions, and value returned goods.”
- Accounting standard No. 14 – Revenue and other incomes, promulgated in the Decision No. 149/2001/QĐ-BTC dated December 31st of the Minister of Finance specifies that:
“Trade discount is a reduction in prices when an enterprise sells a large amount of goods to a customer;