Are damaged import-export goods eligible for a reduction in import-export duty in Vietnam?

Are damaged import-export goods eligible for a reduction in import-export duty in Vietnam?

Based on Article 18 of the Law on Export and Import duties 2016, the conditions for tax reduction are specified as follows:

Tax Reduction

1. Exported or imported goods under the supervision of the customs authority, if damaged or lost and certified by a competent authority, shall be eligible for a tax reduction.

The tax reduction corresponds to the actual loss percentage of the goods. In cases where the exported or imported goods are completely damaged or lost, no tax will be payable.

2. Tax reduction procedures shall be conducted according to the provisions of the law on tax administration.

Thus, exported or imported goods that are damaged may be eligible for a reduction in import-export duty if they meet the following two conditions:

- They are under the supervision of the customs authority.

- Certified by a competent assessment organization.

Moreover, in cases where exported or imported goods are entirely damaged or lost, no tax is required to be paid.

Are damaged import-export goods eligible for a reduction in import-export duty in Vietnam?(Image from the Internet)

What are the required documents for a request to reduce import-export duty in Vietnam?

According to Clause 2, Article 32 of Decree 134/2016/ND-CP amended by Clause 16, Article 1 of Decree 18/2021/ND-CP, the required documents for a request to reduce import-export duty include:

- 01 original Official Dispatch requesting tax reduction from the taxpayer sent via the electronic data processing system of the customs authority according to information criteria in Form No. 3 Appendix VIIa or an Official Dispatch requesting tax reduction according to Form No. 08 in Appendix VII issued with Decree 18/2021/ND-CP.

- 01 copy of the insurance contract and the compensation payment notice from the insurance organization (if available). If the insurance contract does not include compensation for tax, there must be a confirmation from the insurance organization; a contract or minutes of a compensation agreement from the carrier for losses caused by the carrier (if applicable).

- 01 original Minutes of Confirmation of the cause of damage by the competent authority at the location where the damage occurred (the minutes confirming the fire by the local fire and rescue police agency; a written confirmation from one of the related agencies or organizations: Commune-level Police; Commune-level People's Committee; Management Board of Industrial Park; Management Board of Export Processing Zone; Management Board of Economic Zone; Border Gate Management Board; Maritime Port Authority; Aviation Authority at the location of natural disasters, catastrophes, epidemics, and unforeseen accidents causing damage to imported materials, machinery, equipment).

- 01 original Assessment Certificate issued by a business providing assessment services on the quantity of lost goods or the actual loss percentage of goods.

What are the procedures for import-export duty reduction in Vietnam?

According to Clause 2, Article 32 of Decree 134/2016/ND-CP amended by Clause 16, Article 1 of Decree 18/2021/ND-CP, the procedures for import-export duty reduction are as follows:

- The taxpayer submits the documents to the Customs Sub-department at the time of customs clearance or no later than 30 working days from the date of the confirmation document about the degree of damage, loss, or destruction;

- If, at the time of customs clearance, the taxpayer submits all required documents, the Customs Sub-department checks the documents, the actual goods, the conditions for tax reduction, and applies the tax reduction within the customs clearance timeframe as prescribed in Article 23 of the Customs Law 2014;

- If the taxpayer submits documents after customs clearance:

+ Within 30 days of receiving the complete documents, the Provincial or Municipal Customs Department is responsible for compiling, checking information, verifying the accuracy and completeness of the documents, and deciding on tax reduction according to Form No. 12 Appendix VII issued with Decree 18/2021/ND-CP or notifying the taxpayer of the reason for not being eligible for tax reduction and the amount of tax due. If the documents are incomplete, the customs authority shall notify the taxpayer within 03 working days from the date of receiving the documents.

+ If actual inspection of goods that have already passed the customs supervision area is needed to resolve the tax reduction, a decision for post-clearance inspection at the taxpayer's headquarters is issued, and the tasks specified in this item are carried out within a maximum of 40 days from the receipt of complete documents.