According to the VAT General Communiqué No. 117, when labor supply services are provided to certain institutions and organizations, a 90% VAT withholding is applied by the buyers. These services fall under the scope of withholding if the supplied personnel work under the direction and control of the service recipient. The personnel should not be salaried employees of the recipient. Private security and protection services are also included in this scope. If the taxpayer providing the labor supply service obtains this service from another taxpayer, the withholding is applied only to the service provided to them.
Source: VAT Law Circular No. 60
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