The Ministry of Economy and Finance issued Instruction No. 025 MEF dated October 10, 2024, regarding the tax obligations of domestic enterprises that supply goods when offering promotional goods or rewards through sales promotion strategies.

1. The provision of promotional goods or rewards in the form of inventory for sale:

These are classified as taxable supplies.

Enterprises that manufacture or import products liable for special tax or public lighting tax are required to pay the relevant taxes based on the market value.

Value Added Tax (VAT), advance income tax payments, and income tax are applicable on the cost of the products.

2. The provision of promotional goods or rewards that are not part of the inventory for sale or rewards other than goods:

These items are exempt from VAT, prepayment of income tax, and income tax itself.

The VAT incurred on these products cannot be recovered as input credit but can be deducted as an expense when calculating income tax.

3. Deductible expenses

Costs related to promotional items or incentives can be deducted for income tax, as long as they are accurately tracked and well-documented.

4. Other obligations of enterprises:

Enterprises are required to create transparent internal guidelines for promotions, ensure these guidelines are applied uniformly to all customers, and make them publicly available. For the purposes of monthly tax filing, it is necessary to prepare monthly Tax Sale Voucher forms 1 to 3 that include information on promotional items or rewards, and submit these forms through e-Filing.