Vietnam: What does import tariff schedule mean?

What does import tariff schedule mean?

Currently, the law does not specifically define what an import tariff schedule is.

However, according to Article 2 of the Law on Export and Import Taxes 2016, the import tariff schedule can be understood as a list that enumerates types of imported goods along with the corresponding tax rates that each type of good is subject to when imported into a country.

In other words, it is a tool used by the government to determine the tax rates imposed when goods from abroad are brought into their territory.

What are the 5 principles when issuing import tariff schedule in Vietnam?

Based on Article 10 of the Law on Export and Import Taxes 2016, the 5 principles for issuing import tariff schedule are as follows:

Principle 1. Encourage the import of raw materials and prioritize those not yet meeting domestic demand; emphasize the development of high-tech, primary technology fields, energy-saving, and environmental protection.

Principle 2. Align with the socio-economic development orientations of the State and commitments on export and import taxes in international treaties to which the Socialist Republic of Vietnam is a member.

Principle 3. Contribute to market stabilization and state budget revenue.

Principle 4. Be simple, transparent, and facilitate taxpayers and implement tax administrative procedure reforms.

Principle 5. Apply uniform tax rates to goods with the same nature, structure, utility, and similar technical features; the import tax rate decreases progressively from finished products to raw materials; the export tax rate increases progressively from finished products to raw materials.

What is an Import Tariff Schedule? (Image from the Internet)

What are regulations on the Preferential Import Tariff Schedule According to the List of Taxable Items in Vietnam?

Based on Article 5 of Decree 26/2023/ND-CP, the preferential import tariff schedule according to the list of taxable items is regulated as follows:

The preferential import tariff schedule according to the list of taxable items (Preferential Import Tariff Schedule) stipulated in Appendix 2 issued along with Decree 26/2023/ND-CP includes:

* Item 1: Regulations on preferential import tax rates for 97 chapters according to the Vietnam export-import goods list. The content includes: Names of Sections, Chapters; Explanatory notes; Subheading explanation; Preferential import tariff schedule including goods descriptions, item codes (08 digits) according to the Vietnam export-import goods list, the preferential import tax rate stipulated for taxable items.

In cases where the Vietnam export-import goods list is amended or supplemented, customs declarants declare descriptions and item codes according to the amended or supplemented list and apply the tax rates of the amended or supplemented item codes.

* Item 2: Regulations on the list of goods and preferential import tax rates for certain items under Chapter 98.

The content includes: Explanations; Classification methods, conditions, procedures for applying preferential import tax rates under Chapter 98, report on the audit of the use of goods applied with preferential import tax rates stipulated in Chapter 98; list of goods and preferential import tax rates.

- Items listed in the goods and preferential import tax rates stipulated in clause 3, Item 2 of Appendix 2 issued along with this Decree apply the preferential import tax rates stipulated in clause 3, Item 2 of Appendix 2.

The classification of goods and application of preferential import tax rates in Chapter 98 for synchronous CKD auto part kits, non-synchronous auto part kits, chassis with engines, and driver’s cab (chassis with cabin trucks) are implemented according to the provisions of clause 1.1, Item 2, Appendix 2.

The items:

Alloy steel containing Boron and/or Chromium and/or Titanium in group 98.11;

Skin fillers, Functional skin protective creams, and scar-reducing gels in group 98.25;

Nylon cord fabrics 1680/D/2 and 1890 D/2 in group 98.26;

Copper wire with a maximum cross-sectional dimension greater than 6 mm but not exceeding 8 mm in group 98.30;

Virgin Polypropylene resin in group 98.37;

Non-alloyed steel in rod and uneven coil rolled form in group 98.39;

Set-top-boxes in group 98.46;

Network partition umbrellas made from Nano-composite Polymeric Alloy (Neoweb) in group 98.47 apply the preferential import tax rates in Chapter 98 if they meet the specific standards and technical specifications outlined in clause 1, Item 2, Appendix 2.

- The classification methods, conditions, procedures for applying the preferential import tax rates under Chapter 98, the report on the audit of the use of goods applied with preferential import tax rates under Chapter 98: Follow the provisions in clause 2, Item 2, Appendix 2.

- The list of goods and preferential import tax rates stipulated in Chapter 98 for certain items include: item codes; goods descriptions; corresponding item codes in Item 1, Appendix 2 on the Preferential Import Tariff Schedule according to the list of taxable items; preferential import tax rates stipulated in Chapter 98.

- Goods meeting the conditions for classification in Chapter 98 and meeting the conditions for applying special preferential import tax rates according to current regulations have the option to apply special preferential import tax rates stipulated in special preferential import tariff schedule or preferential import tax rates stipulated in Chapter 98 of the Preferential Import Tariff Schedule.

For items classified in Chapter 98, when carrying out customs procedures, customs declarants declare the column "Corresponding Item Code in Item 1, Appendix 2" as stated in Chapter 98, and simultaneously record next to the item code of Chapter 98.