How to prepare export and import duty exemption documentation in Vietnam?

How to prepare export and import duty exemption documentation in Vietnam?

Based on sub-item 1.3, Section 1, Part 1 of Decision 1001/QD-BTC in 2023, the export and import duty exemption documentation is regulated as follows:

- The exemption documentation is the customs documentation as prescribed in the Customs Law 2014 and its guiding documents.

- Additionally, depending on the specific case, the taxpayer must submit one of the following documents:

+ Entrusted contract in case of entrusted export, import of goods: 01 photocopy;

+ Supply contract according to the awarded bid document or the bid appointment document that clearly states the supply price not including import tax in case the organization or individual wins the bid to import goods: 01 photocopy;

+ Supply contract for organizations or individuals conducting petroleum activities that clearly states the supply price not including import tax in case the organization or individual imports goods for petroleum activities: 01 photocopy;

+ Financial leasing contract in case of financial leasing import of goods provided to a tax-exempt or tax-privileged object, clearly stating the supply price not including import tax: 01 photocopy;

+ Transfer document of goods belonging to tax-exempt objects where goods are transferred to another tax-exempt object, clearly stating the transfer price not including import tax: 01 photocopy;

+ Confirmation document from the Ministry of Science and Technology for vehicles specified in clauses 11, 15, 16 Article 16 of the Export and Import Tax Law 2016: 01 original copy;

+ Tax exemption list received by customs for cases of paper notification of the projected tax-exempt list with an accompanying monitoring slip received by customs: 01 photocopy, presenting the original for comparison;

+ Tax exemption decision from the Prime Minister of Vietnam for cases specified in points a, b, d, clause 1, Article 28 of Decree 18/2021/ND-CP: 01 photocopy, presenting the original for comparison;

In case the notice of the tax-exempt list is submitted through the electronic data processing system, the taxpayer does not need to submit the tax-exempt list, and customs will use the tax-exempt list in the electronic data processing system to implement the tax exemption as prescribed.

(Cases requiring notification of the projected tax-exempt import list as prescribed in Article 30 of Decree 134/2016/ND-CP, include:

+ Tax exemption for imported goods to create fixed assets of investment-incentive beneficiaries as stipulated in Article 14 of Decree 134/2016/ND-CP.

+ Tax exemption for imported materials, supplies, components within the 5-year limit as regulated in Article 15 of Decree 134/2016/ND-CP.

+ Tax exemption for imported goods serving petroleum activities as regulated in Article 16 of Decree 134/2016/ND-CP.

+ Tax exemption for imported goods serving shipbuilding, ships for export as stipulated in Article 17 of Decree 134/2016/ND-CP.

+ Tax exemption for seeds, breeding animals, fertilizers, and plant protection drugs as regulated in Article 18 of Decree 134/2016/ND-CP.

+ Tax exemption for imported materials, supplies, components for the production, assembly of medical equipment as regulated in Article 23 of Decree 134/2016/ND-CP.

+ Tax exemption for imported materials, supplies, components directly serving the production of information technology products, digital content, software as regulated in Article 24 of Decree 134/2016/ND-CP.

For cases requiring notification of the projected tax-exempt import list, procedures for notification of the projected tax-exempt import list are guided separately.)

Note

For cases of duty exemption on the luggage of travelers, duty exemption on goods with minimal export or import value, goods sent through express delivery services, the duty exemption documentation is as prescribed in the Customs Law 2014 and its guiding documents.

* Exemption documentation for specific cases:

Aside from the aforementioned tax exemption documentation, depending on the case, the taxpayer must additionally submit:

(1). Movable assets

- Work permit or equivalent document issued by competent authority for foreigners and Vietnamese overseas returning to work in Vietnam for 12 (twelve) months or more: 01 photocopy;

- Document proving the termination of activities or the expiration of employment abroad for organizations and Vietnamese citizens who have worked abroad for 12 (twelve) months or more upon their return: 01 photocopy;

- Passport (with entry stamp of immigration authority at the border gate or separate visa stamp for cases where passports are issued separate visas) or valid alternative passport document (with entry stamp of immigration authority at the border gate) for overseas Vietnamese who have registered permanent residency in Vietnam: 01 photocopy;

- Copy of one of the following documents: Citizen Identification Card, ID card, Certificate of Residence Information, Notification of Personal Identification Number, and Citizen Information in the National Database on Population;

- Decision of the Minister of Finance on tax exemption for transferring assets exceeding the duty exemption limit: 01 original copy.

(2). Gifts

- Agreement document on gifting in case the recipient is an organization: 01 photocopy certified by the receiving organization;

- Document from the superior managing agency permitting the receipt of tax-free goods and document proving that the organization is state-budgeted in case the gift is to an agency or organization funded by the state: 01 original copy;

- Document of the Chairman of the provincial people's committee or ministry/agency in charge for humanitarian or charitable gifts: 01 original copy.

(3). Goods for processing, processed products for export, and production of exported goods

In addition to the tax exemption documentation required under Article 31 of this Decree, on-the-spot exports must submit a document designating the delivery of goods in Vietnam by the foreign organization or individual: 01 photocopy

(4). Goods for border trade of residents

Taxpayers must provide their personal identification number or present the border laissez-passer or Citizen Identification Card.

(5). Goods temporarily imported, re-exported, or temporarily exported, re-imported within a certain period

The tax exemption documentation is the customs documentation as prescribed in the Customs Law 2014 and its guiding documents. For goods temporarily imported for re-export business, taxpayers must additionally submit a letter of guarantee from a credit institution or a deposit slip into the account of the customs authority at the State Treasury: 01 original in case the guarantee letter has not been updated into the customs electronic data processing system.

(6). Goods imported for scientific research and technological development

- Decision on the implementation of the subject, program, project, scientific research task, technological development, and list of goods needing import for the implementation of the subject, program, project, scientific research task, technological development from a competent state agency as per the Science and Technology Law 2013: 01 photocopy;

- Document confirming the list of goods to be used directly for the activities of technology incubation, scientific and technological enterprise incubation from the provincial people's committee, city, or supervisory ministry where the project or incubation facility is located: 01 photocopy;

- Document confirming the list of goods to be used directly for technology innovation from the Ministry of Science and Technology or the agency authorized by the Ministry of Science and Technology: 01 photocopy.

(7). Duty exemption for goods imported directly for security and defense

- Official Dispatch requesting from the Ministry of National Defense, Ministry of Public Security, or units authorized or assigned by the Ministry of National Defense, Ministry of Public Security according to Form No. 03a in Appendix 7 issued with Decree 18/2021/ND-CP: 01 original;

- Sale contract: 01 photocopy;

- Entrusted import contract or supply contract according to bid document or bid appointment document, clearly stating the supply price not including import tax for entrusted or bid cases: 01 photocopy.

(8). Goods for currency printing and coin minting

Document from the State Bank of Vietnam permitting the organization to import machinery, equipment, materials, supplies, components, and parts for currency printing and coin minting activities: 01 photocopy.

(9). Goods imported for emergency relief when natural disasters, calamities, epidemics occur

- Customs documentation as prescribed in Article 24 of the Customs Law 2014;

- Confirmation document from the provincial people's committee or ministry/sector equivalent level on the import of goods for emergency relief, detailing the damage caused by natural disasters, calamities, or epidemics: 01 original;

- List of goods imported directly for emergency relief: 01 original;

- Decision announcing the epidemic from the competent authority as per the Infectious Disease Prevention and Control Law 2007 for cases of importing goods to overcome the epidemic: 01 photocopy.

(10). Export tax exemption for python skin products originating from breeding farms

- Breeding farm registration certificate for wild animal husbandry issued by the local Forestry Department or the agency designated by the Ministry of Agriculture and Rural Development: 01 photocopy, presenting the original during the first export for comparison;

- Confirmation document of the number of slaughtered pythons with breeding origin certified by the local Forestry Department for each export procedure: 01 photocopy, presenting the original for comparison.(11). Exemption of Export and Import Taxes under International Treaties

- The type and quantity of goods are specified in the international treaties;

- A confirmation document from the proposing agency for the signing or accession to the international treaty, or from the specialized management agency in case the international treaty does not specify the type and quantity of tax-exempt goods.

In case the proposing agency for the signing or accession to the international treaty is not the specialized management agency, the basis for tax exemption shall be the confirmation document of the proposing agency for the signing or accession to the international treaty.

How to handle export and import tax exemption documents in Vietnam? (Image from Internet)

What are cases eligible for export and import tax exemption in Vietnam?

According to Article 16 of the Import and Export Tax Law 2016, cases eligible for export and import tax exemption include:

(1). Goods exported or imported by foreign organizations and individuals entitled to privileges and immunities in Vietnam within the appropriate limits as per the international treaties to which the Socialist Republic of Vietnam is a member; goods within the tax-free luggage allowance of exit and entry passengers; goods imported to be sold in duty-free shops.

(2). Moving assets, gifts within the allowance limit of foreign organizations or individuals given to Vietnamese organizations or individuals and vice versa.

Moving assets, gifts that exceed the tax exemption limit must pay tax on the excess part, except for organizations and units covered by the state budget and authorized to receive them, or in cases for humanitarian or charitable purposes.

(3). Goods traded and exchanged across borders by border residents in the list and within the limit for production and consumption of border residents.

Goods purchased or transported within the limit but not used for production or consumption by border residents, and goods exported, imported by foreign traders permitted to do business in border markets must pay tax.

(4). Goods entitled to export and import tax exemption under international treaties to which the Socialist Republic of Vietnam is a member.

(5). Goods with a value or tax amount payable below the minimum level.

(6). Raw materials, supplies, and components imported for processing export products; finished products imported to be attached to processed products; processed products for export.

Processed products for export made from domestic raw materials and supplies that are subject to export tax will not be exempted from tax on the value corresponding to those domestic raw materials and supplies.

Exported goods for processing and then imported will be exempted from export and import taxes calculated on the value of exported raw materials constituting the processed products. For goods exported for processing and then imported which are natural resources, minerals, or products with a total value of natural resources, minerals plus energy costs constituting 51% or more of the product's cost, tax exemption is not granted.

(7). Raw materials, supplies, and components imported for the production of export goods.

(8). Goods produced, processed, recycled, or assembled in non-tariff zones not using imported raw materials and components when imported into the domestic market.

(9). Goods temporarily imported for re-export or temporarily exported for re-import within a certain period, including:

- Goods temporarily imported for re-export, temporarily exported for re-import for organizing or participating in fairs, exhibitions, product displays, cultural, sports, or other events; machinery, equipment temporarily imported for re-export for testing, product research and development; machinery, equipment, professional tools temporarily imported for re-export, temporarily exported for re-import to serve specific work or processing for foreign traders, except for cases involving investment projects, construction, and installation projects, and production equipment directly related to production;

- Machinery, equipment, components, and parts temporarily imported for replacement or repair of foreign ships and aircraft or temporarily exported for replacement or repair of Vietnamese ships and aircraft abroad; goods temporarily imported for re-export to supply foreign ships and aircraft docked at Vietnamese ports;

- Goods temporarily imported for re-export or temporarily exported for re-import for warranty, repair, or replacement purposes;

- Moving media following temporary import, re-export, or temporary export, re-import procedures to contain import, export goods;

- Goods traded under temporary import for re-export contract terms (including extension periods) are secured by credit or collateral covering the import tax amount payable for the temporarily imported goods' value.

(10). Non-commercial goods in the following cases: samples; photos, films, models replacing samples; small quantities of advertising prints.

(11). Imported goods to form fixed assets for investment incentive beneficiaries following investment law regulations, including:

- Machinery, equipment; components, parts, detached parts, spare parts for complete assembly with machinery, equipment; raw materials, supplies used to manufacture machinery and equipment or manufacture components, parts, detached parts, spare parts of machinery and equipment;

- Special transport means in technological lines directly used for the project's production activities;

- Construction materials not produced domestically.

Import tax exemption for imported goods specified in this clause is applied to both new investment projects and expansion investment projects.

(12). Plant seeds; animal breeds; fertilizers, plant protection drugs that are not domestically produced and necessary for import as per the competent state management agency's regulations.

(13). Raw materials, supplies, and components not domestically produced, imported for the production of an investment project under the list of sectors, industries, or areas with special investment incentives, or areas with particularly difficult socio-economic conditions as per investment law regulations, high-tech enterprises, science and technology enterprises, science and technology organizations entitled to import tax exemption for five years from the production start date.

Import tax exemption specified in this clause does not apply to investment projects in mineral extraction; projects producing goods with natural resources, minerals' total value plus energy costs constituting 51% or more of the cost; projects producing and trading goods, services subject to excise tax.

(14). Raw materials, supplies, components not domestically produced, imported for the production and assembly of prioritized medical equipment for research and development, exempt from import tax for five years from the production start date.

(15). Imported goods for petroleum activities, including:

- Machinery, equipment, spare parts, special transport means necessary for petroleum activities, including temporary import for re-export;

- Components, parts, detached parts, spare parts for complete assembly or use in unison with machinery, equipment; raw materials, supplies used to manufacture machinery, equipment; components, parts, detached parts, spare parts of machinery, equipment necessary for petroleum activities;

- Supplies necessary for petroleum activities not domestically produced.

(16). Projects, shipbuilding premises under the list of sectors, industries with investment incentives as per investment law regulations, exempt from taxes for:

- Imported goods to form fixed assets of shipbuilding premises, including machinery, equipment; components, parts, detached parts, spare parts for complete assembly with machinery, equipment; raw materials, supplies used to manufacture machinery, equipment; components, parts, detached parts, spare parts of machinery, equipment; transport means in the technological line directly serving shipbuilding activities; construction materials not domestically produced;

- Imported goods are machinery, equipment, raw materials, supplies, components, semi-finished products not produced domestically for shipbuilding;

- Exported ships.

(17). Machinery, equipment, raw materials, supplies, components, parts, and accessories imported for money printing and coining activities.

(18). Imported goods are raw materials, supplies, components not domestically produced for direct production of information technology products, digital content, software.

(19). Exported and imported goods to protect the environment, including:

- Special machinery, equipment, transport means, tools, supplies imported not domestically produced for collecting, transporting, processing, treating wastewater, waste, emissions, monitoring, and analyzing the environment, producing renewable energy; treating environmental pollution, responding to, and handling environmental incidents;

- Exported products manufactured from waste recycling and treatment activities.

(20). Specialized imported goods not domestically produced directly used for education.

(21). Imported goods are specialized machinery, equipment, spare parts, supplies not domestically produced, scientific books directly used for scientific research, technology development, technology incubation, science and technology enterprise incubation, technology innovation.

(22). Specialized imported goods directly used for security and national defense, in which special transport means must be the type not domestically produced.

(23). Exported and imported goods to ensure social welfare, overcome natural disasters, calamities, epidemics, and other special cases.

Who is subject to export and import taxes in Vietnam?

According to Article 2 of the Import and Export Tax Law 2016, subjects to export and import taxes include:

- Goods exported or imported through Vietnam's borders and checkpoints.

- Goods exported from the domestic market into non-tariff zones, goods imported from non-tariff zones into the domestic market.

- Locally exported, imported goods and those of enterprises exercising the right to export, import, and distribution.

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

+ Goods in transit, transferred, or transshipped;

+ Humanitarian aid goods, non-repayable aid goods;

+ Goods exported from non-tariff zones abroad; goods imported from abroad into non-tariff zones and only used within non-tariff zones; goods transferred from one non-tariff zone to another;

+ Oil and gas used for paying natural resource tax to the State upon export.