Are goods that are grant aid subject to export and import duties in Vietnam?

Are goods that are grant aid subject to export and import duties in Vietnam?

Pursuant to Article 2 of the Law on Export and import duties 2016 stipulating the tax subjects as follows:

Tax Subjects

1. Goods exported or imported via the customs checkpoints and borders of Vietnam.

2. Goods exported from the domestic market to a free trade zone, goods imported from a free trade zone into the domestic market.

3. Goods exported, imported on the spot, and goods exported or imported by enterprises exercising the right to export, import, and distribute.

4. Export and import tax subjects do not apply to the following cases:

a) Goods in transit, transported, or transshipped;

b) Humanitarian aid goods, goods that are grant aid;

c) Goods exported from the free trade zone abroad; goods imported from abroad into the free trade zone and used only within the free trade zone; goods transferred from one free trade zone to another;

d) The portion of crude oil used to pay resource tax to the State when exported.

5. The Government of Vietnam details this Article.

From the above regulations, it can be seen that goods that are grant aid are one of the subjects exempt from import tax.

Are goods that are grant aid subject to export and import duties in Vietnam? (Image from the Internet)

What is the basis for calculation of proportional duties in Vietnam?

According to the provisions of Article 5 of the Law on Export and import duties 2016 regarding the basis for calculation of proportional duties as follows:

- The amount of Export and import duties is determined based on the taxable value and the percentage rate of each item at the time of tax calculation.

- The export tax rate is specifically prescribed for each item in the export tariff.

In the case of goods exported to a country, group of countries, or territory with preferential agreements on export taxes in trade relations with Vietnam, these agreements will be implemented.

- The import tax rate includes preferential, specially preferential, and normal duty rates applied as follows:

+ Preferential duty rates apply to goods imported from countries, groups of countries, or territories that grant most-favored-nation treatment in trade relations with Vietnam; goods from free trade zones imported into the domestic market that meet the origin conditions from countries, groups of countries, or territories that grant most-favored-nation treatment in trade relations with Vietnam;

+ Specially preferential duty rates apply to goods imported from countries, groups of countries, or territories with special preferential agreements on import taxes in trade relations with Vietnam; goods from free trade zones imported into the domestic market that meet the origin conditions from countries, groups of countries, or territories with special preferential agreements on import taxes in trade relations with Vietnam;

+ Normal duty rates apply to imported goods that do not fall within the cases specified at points a and b, clause 3 of Article 5 of the Law on Export and import duties 2016. Normal duty rates are set at 150% of the preferential rate for each corresponding item. In cases where the preferential tax rate is 0%, the Prime Minister of the Government of Vietnam shall decide on the application of the normal tax rate based on the provisions of Article 10 of the Law on Export and import duties 2016.

What are the rules for imposition of tariff schedules and duty rates in Vietnam?

According to the provisions of Article 10 of the Law on Export and import duties 2016, the principles for imposition of tariff schedules and duty rates are as follows:

- Encourage the importation of raw materials that have not met domestic demand; prioritize high-tech, technology source development, energy saving, and environmental protection.

- Align with the socioeconomic development orientation of the State and international commitments on Export and import duties to which the Socialist Republic of Vietnam is a signatory.

- Contribute to market stabilization and state budget revenue.

- Simple, transparent, and facilitating for taxpayers and reforming administrative procedures related to taxes.

- Apply uniform duty rates to goods with the same nature, structure, utility, and similar technical functions; import duty rates decrease progressively from finished products to raw materials; export duty rates increase progressively from finished products to raw materials.

Which authority is responsible for imposition of tariff schedules and duty rates in Vietnam?

According to Article 11 of the Law on Export and import duties 2016, the authority responsible for imposition of tariff schedules and duty rates is as follows:

- The Government of Vietnam, based on Article 10 of the Law on Export and import duties 2016, the Export Tariff according to the list of taxable groups and the export tax rate framework for each taxable group, the preferential tariff committed in the Protocol of Accession to the World Trade Organization (WTO) ratified by the National Assembly, and other international treaties to which the Socialist Republic of Vietnam is a signatory to issue:

+ Export Tariff; Preferential Export Tariff;

+ Preferential Import Tariff; Specially Preferential Import Tariff;

+ List of goods and absolute duty rates, mixed taxes, import taxes outside quotas.

- In necessary cases, the Government of Vietnam submits to the Standing Committee of the National Assembly amendments and supplements to the Export Tariff according to the list of taxable groups and the export tax rate framework for each taxable group.

- The authority for applying anti-dumping tax, anti-subsidy tax, and safeguard tax follows the regulations in Chapter III of the Law on Export and import duties 2016.