By 2025, how many import tax rate are there after the reduction in Vietnam?

By 2025, how many import tax rate are there after the reduction in Vietnam?

According to point c, clause 1, Section 3, Article 1 of Decision 508/QD-TTg of 2022, the regulation is as follows:

III. STRATEGIES FOR IMPLEMENTATION

1. On tax policy reform

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c) For export tax, import tax: continue to streamline the number of tax rates to simplify the import tax schedule, aiming to reduce the number of import tax rates from 32 currently to about 25 by 2025 and to 20 by 2030. Study and amend policies on export tax and import tax to promote exports, encourage an increase in domestic value, limit the export of natural resources and raw minerals; adopt appropriate preferential policies to promote the development of key industries, supporting industries, and priority fields, ensuring alignment with the socio-economic development orientations of the country in each period and international commitments. Study amendments to regulations on on-site export goods, on-site import goods, and related regulations on free trade zones, ensuring synchronization with relevant legal provisions, and limiting trade fraud and tax evasion;

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Accordingly, the solution to implement the strategy for reforming export tax and import tax policies according to the tax system reform strategy until 2030 is as follows:

- Continue to streamline the number of tax rates to simplify the import tax schedule, aiming to reduce the number of import tax rates from 32 currently to about 25 by 2025 and to 20 by 2030;

- Study and amend policies on export tax and import tax to promote exports, encourage an increase in domestic value, and limit the export of natural resources and raw minerals;

- Adopt appropriate preferential policies to promote the development of key industries, supporting industries, and priority fields, ensuring alignment with the socio-economic development orientations of the country in each period and international commitments;

- Study amendments to regulations on on-site export goods, on-site import goods, and related regulations on free trade zones, ensuring synchronization with relevant legal provisions, and limiting trade fraud and tax evasion.

Accordingly, to implement the strategy for reforming export tax and import tax policies according to the tax system reform strategy until 2030, it is aimed that by 2025 the number of import tax rates will be reduced from the current 32 rates to about 25 rates by 2025.

By 2025, how many import tax rate are there after the reduction in Vietnam? (Image from the Internet)

What are the bases for calculating export and import duties in Vietnam?

According to Article 5 of the Law on export and import duties 2016, the bases for calculating export and import duties are as follows:

- The amount of export tax and import tax is determined based on the taxable value and the tax rate percentage (%) of each item at the time of tax calculation.

- The tax rate for export goods is specified for each item in the export tariff schedule.

In cases where goods are exported to a country, group of countries, or territory with preferential export tax agreements in trade relations with Vietnam, these agreements shall be followed.

- The tax rate for import goods includes preferential tax rates, special preferential tax rates, and ordinary tax rates, applied as follows:

+ Preferential tax rates apply to import goods originating from countries, groups of countries, or territories that have most-favored-nation (MFN) treatment in trade relations with Vietnam; goods from free trade zones imported into the domestic market meeting the origin conditions from countries, groups of countries, or territories that have MFN treatment in trade relations with Vietnam;

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

+ Ordinary tax rates apply to import goods not falling under the above cases. The ordinary tax rate is defined as 150% of the preferential tax rate for each corresponding item. In cases where the preferential tax rate is 0%, the Prime Minister of the Government of Vietnam shall decide the application of the ordinary tax rate based on the provisions of Article 10 of the Law on export and import duties 2016.

What are the types of tax rates for import goods in Vietnam?

According to clause 3, Article 5 of the Law on export and import duties 2016, it is regulated:

Bases for calculating export and import duties for goods applying the percentage method

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3. The tax rates for import goods include preferential tax rates, special preferential tax rates, and ordinary tax rates, applied as follows:

a) Preferential tax rates apply to import goods originating from countries, groups of countries, or territories that have most-favored-nation (MFN) treatment in trade relations with Vietnam; goods from free trade zones imported into the domestic market meeting the origin conditions from countries, groups of countries, or territories that have MFN treatment in trade relations with Vietnam;

b) Special preferential tax rates apply to import goods originating from countries, groups of countries, or territories that have special preferential agreements on import taxes in trade relations with Vietnam; goods from free trade zones imported into the domestic market meeting the origin conditions from countries, groups of countries, or territories that have special preferential agreements on import taxes in trade relations with Vietnam;

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Accordingly, the tax rates for import goods include preferential tax rates, special preferential tax rates, and ordinary tax rates.