They said the rule, which was issued by the Ministry of Finance in December last year and came into force on January 1 this year, will lead their products prices to climb and erode their competitiveness.
The director of a wooden furniture firm specializing which was set up in January said the rule makes it hard for his company to sell products.
He explained that if his firm cannot fulfill the requirement of having VND1 billion worth of assets, it will have to pay the full VAT for its inputs, which will result in its production costs surging.
The tax will make business start-ups less competitive on both domestic and export markets than those enjoying a lower VAT, he said.
Pham Ngoc Hung, vice chairman of the HCMC Union of Business Associations, told the Daily that many enterprises are asking the association for help to deal with the new VAT regulation.
Hung said the new regulation on VAT of the Finance Ministry is unworkable since business start-ups in the services sector do not need huge investments.
The requirement is not fit for processing enterprises as many of them do the outsourcing for their customers, he said.
Although the new ministry’s new rule is designed to thwart the illegal trading of VAT receipts, Hung said, the tax authority should find ways to tackle those dishonest and fraudulent firms, instead of all enterprises.
Đăng ký: VietNam News