Tax topics are often difficult to understand, today I want to share with you the history of the Value Added Tax.

In the nineteen fifty-four (1954), the French economist, Maurié Lauré devised the value-added tax, at this time he was the director of the French tax office. After that, the French government imposed a value-added tax, on April tenth, nineteen fifty-four (April 10, 1954) at large enterprises in France. In the beginning, value-added tax played an active role in national revenue, and achieved social compliance, so this matter spread from France to other countries.

What about in Vietnam?.

The First Southern Vietnam Repuplic period, from nineteen fifty-five to nineteen sixty-three (from 1955 – to 1963), value-added tax was mentioned in National Assembly meeting, in which the first speaker was congressman Tran Le Xuan. However, due to individual presentations, as well as limited initial confusion, the law on value-added tax was not approved.

The Second South Vietnam Republic period, from nineteen sixty-seven to nineteen seventy-five (from 1967 to 1975). In the first two years, members of the National Assembly continued to discuss the value-added tax, but this tax rate was not approved. To nineteen seventy (1970), it was officially promulgated, by Prime Minister, although the congress had not yet approved it. After implementation, the result of the assessment is that the total national revenue increases by 70%.

After the two regions, South and North Vietnam were unified, nineteen seventy-five (1975), Vietnam applies sales tax.

The Law on Value-Added Tax was officially passed by the National Assembly, on May tenth, nineteen ninety-seven (May 10, 1997), and takes effect from January first, nineteen ninety-nine (January 01, 1999).

Law on value-added tax has more advantages than disadvantages. In this sharing, only mention the disadvantages of value-added tax are as follows:

The first, because value-added tax is deducted and refunded, so it has to be document-based, creating a large amount of documentation that has required. At the same time, to compare documents, there must be declaration procedures and forms. Therefore, the assessment is complicated.

The next, value-added tax, collects tax on goods and services at the final consumption stage, but the tax payment must go through the enterprise, which increases the personnel and administrative costs of the enterprise. Therefore, the assessment is an increase in social costs.

Finally, in each country, with many different value-added tax rates, will face difficulties in implementation. The reason is that it is not possible to define all the objects that are classified into any profession and any tax rate. At the same time, many subjects with different tax rates must comply with different sets of tax documents, thereby creating complexity. In addition, some individuals and organizations take advantage of this complexity, carry out acts of buying and selling invoices, and illegal tax refunds.

In Vietnam, the tax rates are as follows:

• Value-added tax rate of zero percent (0%), applicable to exported goods and services, international transportation or other export services permitted by law.
• Value-added tax rate of five percent (5%), applicable to clean water, medical equipment, teaching aids, cultural and artistic activities, services related to agriculture, forestry and fishery.
• Value-added tax rate of ten percent (10%), applied to the remaining goods, that not subject to value-added tax rate of five percent.
• Vietnam also stipulates that goods and services are not subject to value-added tax, and input tax is not deducted. There are cases that do not have to declare tax for calculation, but still receive input deduction.

Currently, the strategic vision for reforming Vietnam's tax system to year twenty thirty (year 2030), which is tax management according to the method of risk management, application of information technology, and reduce procedures and the cost of tax.

Particularly for value-added tax, a basic tax rate will be applied.