Is imported lubricating oil subject to environmental protection tax? How to determine the tax rate for imported grease in Vietnam?

Are lubricants subject to environmental protection tax in Vietnam?

The subjects liable to environmental protection tax are stipulated in Article 3 of the Law on Environmental Protection Tax 2010 as follows:

Taxable Objects

1. Gasoline, oil, grease, including:

a) Gasoline, except ethanol;

b) Jet fuel;

c) Diesel oil;

d) Kerosene;

đ) Mazut oil;

e) Lubricating oil;

g) Grease.

2. Coal, including:

a) Brown coal;

b) Anthracite coal;

c) Coke coal;

d) Other types of coal.

3. Hydro-chloro-fluoro-carbon (HCFC) solution.

4. Plastic bags subject to tax.

...

Thus, it is clear that lubricating oil is one of the objects subject to environmental protection tax and therefore is obliged to pay tax.

Is imported lubricating oil subject to environmental protection tax? How to determine the tax rate for imported grease in Vietnam? (Image from the Internet)

How to determine the tax rate applied to imported lubricating oil in Vietnam?

According to Article 4 of Circular 152/2011/TT-BTC, the environmental protection tax payable for trading lubricating oil is determined by the following formula:

Simultaneously, Clause 1, Article 8 of the Law on Environmental Protection Tax 2010 specifies the tax rate applied to imported lubricating oil as follows:

Additionally, the environmental protection tax for importing lubricating oil is determined by the following formula:

Therefore, the environmental protection tax applied to imported lubricating oil ranges from 300 to 2,000 VND/1 liter.

What is the basis for calculating environmental protection tax on lubricating oil in Vietnam?

Based on Article 6 of the Law on Environmental Protection Tax 2010 regarding the basis for calculating environmental protection tax on imported goods as follows:

Tax Calculation Basis

1. The basis for calculating environmental protection tax is the taxable quantity of goods and the absolute tax rate.

2. The taxable quantity of goods is stipulated as follows:

a) For domestically produced goods, the taxable quantity is the quantity of goods produced and sold, exchanged, internally consumed, gifted;

b) For imported goods, the taxable quantity is the quantity of imported goods.

3. The absolute tax rate used for tax calculation is stipulated in Article 8 of this Law.

Simultaneously, Article 5 of Circular 152/2011/TT-BTC also prescribes the basis for calculating environmental protection tax applicable to imported goods as follows:

Tax Calculation Basis

The basis for calculating environmental protection tax is the taxable quantity of goods and the absolute tax rate

1. The taxable quantity of goods is specified as follows:

1.1. For domestically produced goods, the taxable quantity is the quantity of goods produced and sold, exchanged, internally consumed, gifted, promotional, advertising.

1.2. For imported goods, the taxable quantity is the quantity of imported goods.

In the case where the quantity of goods subject to environmental protection tax that is exported, sold, and imported is calculated in a unit of measurement different from the unit specified for tax calculation in the environmental protection tax schedule issued by the National Assembly Standing Committee, it must be converted to the unit of measurement specified in the environmental protection tax schedule for tax calculation.

1.3. For goods that are mixed fuels containing gasoline, oil, fossil-based grease, and biofuels, the taxable quantity in the period is the quantity of fossil-based gasoline, oil, grease contained in the quantity of mixed fuels imported or produced and sold, exchanged, gifted, entered into internal consumption, converted to the tax calculation unit of the corresponding goods. The determination is as follows:

...

Furthermore, regarding the initial timing for calculating environmental protection tax applied to imported grease, it will be based on Article 9 of the Law on Environmental Protection Tax 2010 regarding the timing of environmental protection tax calculation as follows:

Timing of Tax Calculation

1. For goods produced and sold, exchanged, or gifted, the timing of tax calculation is the time of transfer of ownership or use rights of goods.

2. For goods put into internal consumption, the timing of tax calculation is the time of using goods.

3. For imported goods, the timing of tax calculation is the time of customs declaration registration.

4. For gasoline, oil produced or imported for sale, the timing of tax calculation is the time the primary gasoline and oil businesses distribute it.

For imported goods, the timing of tax calculation is the time of customs declaration registration.

Thus, according to the above regulations, the quantity of imported grease used to calculate environmental protection tax is based on the quantity of imported grease.

*Note: In cases where the quantity of goods subject to environmental protection tax that is exported, sold, and imported is calculated in a measurement unit different from the unit specified for tax calculation in the environmental protection tax schedule issued by the National Assembly Standing Committee, it must be converted to the measurement unit specified in the environmental protection tax schedule for tax calculation.