{"id":17248,"date":"2024-10-06T07:25:33","date_gmt":"2024-10-06T07:25:33","guid":{"rendered":"https:\/\/vietnga.vn\/why-farmers-benefit-from-the-5-vat-imposed-on-fertilizers\/"},"modified":"2024-10-06T07:25:33","modified_gmt":"2024-10-06T07:25:33","slug":"why-farmers-benefit-from-the-5-vat-imposed-on-fertilizers","status":"publish","type":"post","link":"https:\/\/vietnga.vn\/en\/why-farmers-benefit-from-the-5-vat-imposed-on-fertilizers\/","title":{"rendered":"Why Farmers Benefit from the 5% VAT Imposed on Fertilizers"},"content":{"rendered":"<p>The implementation of a <a href=\"https:\/\/vietnga.vn\/ap-thue-vat-phan-bon-nong-dan-duoc-thu-huong\/\">5% VAT<\/a> on fertilizers not only helps create a level playing field between domestic and imported products but also brings direct benefits to farmers. <\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_67_1 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title \" >PH\u1ee4 L\u1ee4C<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/vietnga.vn\/en\/why-farmers-benefit-from-the-5-vat-imposed-on-fertilizers\/#1_Current_VAT_Policy_on_Fertilizers\" title=\"1. Current VAT Policy on Fertilizers\">1. Current VAT Policy on Fertilizers<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/vietnga.vn\/en\/why-farmers-benefit-from-the-5-vat-imposed-on-fertilizers\/#2_Why_Does_%E2%80%9CVAT_Exemption%E2%80%9D_Actually_Make_Fertilizer_Prices_Rise\" title=\"2. Why Does \u201cVAT Exemption\u201d Actually Make Fertilizer Prices Rise?\">2. Why Does \u201cVAT Exemption\u201d Actually Make Fertilizer Prices Rise?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/vietnga.vn\/en\/why-farmers-benefit-from-the-5-vat-imposed-on-fertilizers\/#3_Benefits_of_Applying_a_5_VAT_on_Fertilizers\" title=\"3. Benefits of Applying a 5% VAT on Fertilizers\">3. Benefits of Applying a 5% VAT on Fertilizers<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/vietnga.vn\/en\/why-farmers-benefit-from-the-5-vat-imposed-on-fertilizers\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h3><span class=\"ez-toc-section\" id=\"1_Current_VAT_Policy_on_Fertilizers\"><\/span>1. Current VAT Policy on Fertilizers<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Since 2015, when Law No. 71\/2014\/QH13 came into effect, fertilizers were shifted from being subject to a 5% VAT rate to being exempt from VAT.<br \/>Initially, this policy was expected to reduce fertilizer prices and benefit farmers.<br \/>However, after nearly a decade, reality has shown the opposite \u2014 fertilizer prices have not decreased but instead continued to rise.  <\/p>\n<figure id=\"attachment_12699\" aria-describedby=\"caption-attachment-12699\" style=\"width: 462px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-12699\" src=\"https:\/\/vietnga.vn\/wp-content\/uploads\/2024\/09\/thue-vat-5.jpg\" alt=\"If the 5% VAT rate is reintroduced, both the agricultural sector and farmers will benefit more compared to the current tax-exempt regulation.\" width=\"472\" height=\"354\" title=\"\" srcset=\"https:\/\/vietnga.vn\/wp-content\/uploads\/2024\/09\/thue-vat-5.jpg 472w, https:\/\/vietnga.vn\/wp-content\/uploads\/2024\/09\/thue-vat-5-300x225.jpg 300w\" sizes=\"(max-width: 472px) 100vw, 472px\" \/><figcaption id=\"caption-attachment-12699\" class=\"wp-caption-text\">If the 5% VAT rate is reintroduced, both the agricultural sector and farmers will benefit more compared to the current tax-exempt regulation.<\/figcaption><\/figure>\n<h3><span class=\"ez-toc-section\" id=\"2_Why_Does_%E2%80%9CVAT_Exemption%E2%80%9D_Actually_Make_Fertilizer_Prices_Rise\"><\/span>2. Why Does \u201cVAT Exemption\u201d Actually Make Fertilizer Prices Rise?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Under the current law, fertilizers are not subject to VAT, but in reality, production costs still include a 10% input VAT on materials and services.<br \/>This means fertilizer manufacturers must include these input tax costs in their selling prices. <\/p>\n<p>Previously, when fertilizers were taxed at 5% VAT, producers could deduct or even receive refunds on input taxes. However, since the exemption policy took effect, companies can no longer claim these deductions, forcing them to absorb the entire 10% input VAT themselves. <\/p>\n<p>As a result, production costs have increased, and ultimately, farmers bear this burden through higher fertilizer prices.<br \/>To put it simply \u2014 companies now pay the input VAT upfront to the State, and then recover it indirectly from farmers through product prices. In the end, it\u2019s the farmers who shoulder the 10% input VAT. <\/p>\n<h3><span class=\"ez-toc-section\" id=\"3_Benefits_of_Applying_a_5_VAT_on_Fertilizers\"><\/span>3. Benefits of Applying a 5% VAT on Fertilizers<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>When fertilizers are once again subject to a 5% VAT, farmers will actually benefit.<br \/>This is because the input VAT paid by fertilizer manufacturers can be deducted or refunded, helping to lower production costs.<br \/>Farmers will then only need to pay a 5% VAT on the final product, instead of indirectly bearing the 10% input tax already included in the current selling price.<br \/>As a result, fertilizer prices will decrease, allowing farmers to save costs and increase profits.   <\/p>\n<figure id=\"attachment_12702\" aria-describedby=\"caption-attachment-12702\" style=\"width: 1014px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"size-large wp-image-12702\" src=\"https:\/\/vietnga.vn\/wp-content\/uploads\/2024\/09\/thue-vat-5-1-1024x692.jpg\" alt=\"Reintroducing the 5% VAT rate on fertilizers is therefore necessary to help reduce selling prices, support farmers, and protect domestic fertilizer production from unfair competition.\" width=\"1024\" height=\"692\" title=\"\" srcset=\"https:\/\/vietnga.vn\/wp-content\/uploads\/2024\/09\/thue-vat-5-1-1024x692.jpg 1024w, https:\/\/vietnga.vn\/wp-content\/uploads\/2024\/09\/thue-vat-5-1-300x203.jpg 300w, https:\/\/vietnga.vn\/wp-content\/uploads\/2024\/09\/thue-vat-5-1-768x519.jpg 768w, https:\/\/vietnga.vn\/wp-content\/uploads\/2024\/09\/thue-vat-5-1-1536x1038.jpg 1536w, https:\/\/vietnga.vn\/wp-content\/uploads\/2024\/09\/thue-vat-5-1.jpg 1749w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><figcaption id=\"caption-attachment-12702\" class=\"wp-caption-text\">Reintroducing the 5% VAT rate on fertilizers is therefore necessary to help reduce selling prices, support farmers, and protect domestic fertilizer production from unfair competition.<\/figcaption><\/figure>\n<p>Another important issue is that imported fertilizers are currently exempt from VAT, giving them a significant price advantage over domestically produced fertilizers.<br \/>By applying a 5% VAT, the government can create a fairer competitive environment between domestic and imported fertilizers, thereby encouraging the growth of Vietnam\u2019s fertilizer manufacturing industry. <\/p>\n<p>If the current situation continues \u2014 where local producers bear input taxes without deduction rights \u2014 investors will be reluctant to invest in advanced technology for fertilizer production.<br \/>Reintroducing the 5% VAT rate will help motivate the domestic fertilizer industry to grow more sustainably, ensuring agricultural security and enhancing the competitiveness of Vietnamese-made products. <\/p>\n<h3><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The implementation of a <a href=\"https:\/\/vietnga.vn\/ap-thue-vat-phan-bon-nong-dan-duoc-thu-huong\/\">5% VAT <\/a>on fertilizers is essential to reduce prices, support farmers, and protect the domestic fertilizer industry.<br \/>This policy not only provides direct benefits to farmers but also contributes to the sustainable development of Vietnam\u2019s agricultural sector. <\/p>\n<p><em>Source: PetroTimes \u2013 Journal of the Vietnam Oil and Gas Association<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The implementation of a 5% VAT on fertilizers not only helps create a level playing field between domestic and imported products but also brings direct benefits to farmers. 1. Current VAT Policy on Fertilizers Since 2015, when Law No. 71\/2014\/QH13 came into effect, fertilizers were shifted from being subject to a 5% VAT rate to &#8230; <a title=\"Why Farmers Benefit from the 5% VAT Imposed on Fertilizers\" class=\"read-more\" href=\"https:\/\/vietnga.vn\/en\/why-farmers-benefit-from-the-5-vat-imposed-on-fertilizers\/\" aria-label=\"More on Why Farmers Benefit from the 5% VAT Imposed on Fertilizers\">Read more<\/a><\/p>\n","protected":false},"author":14,"featured_media":12700,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[87],"tags":[],"acf":[],"_links":{"self":[{"href":"https:\/\/vietnga.vn\/en\/wp-json\/wp\/v2\/posts\/17248"}],"collection":[{"href":"https:\/\/vietnga.vn\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vietnga.vn\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vietnga.vn\/en\/wp-json\/wp\/v2\/users\/14"}],"replies":[{"embeddable":true,"href":"https:\/\/vietnga.vn\/en\/wp-json\/wp\/v2\/comments?post=17248"}],"version-history":[{"count":0,"href":"https:\/\/vietnga.vn\/en\/wp-json\/wp\/v2\/posts\/17248\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vietnga.vn\/en\/wp-json\/wp\/v2\/media\/12700"}],"wp:attachment":[{"href":"https:\/\/vietnga.vn\/en\/wp-json\/wp\/v2\/media?parent=17248"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vietnga.vn\/en\/wp-json\/wp\/v2\/categories?post=17248"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vietnga.vn\/en\/wp-json\/wp\/v2\/tags?post=17248"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}