What date is Black Friday 2024? Are parallel imports from Black Friday subject to value-added tax in Vietnam?

What date is Black Friday 2024? Are parallel imports from Black Friday subject to value-added tax in Vietnam?

Black Friday, also known as the Dark Friday, is the first Friday following Thanksgiving, which is the Friday of the fourth week of November each year.

In 2024, Black Friday will take place on November 29, 2024. This is the biggest shopping day of the year with many attractive discount programs.

Based on Article 2 of Circular 219/2013/TT-BTC stipulating the subjects subject to value-added tax as follows:

Taxable Subjects

Subjects subject to value-added tax (VAT) are goods and services used for production, business, and consumption in Vietnam (including goods and services purchased from foreign organizations and individuals), excluding those not subject to VAT as guided in Article 4 of this Circular.

Therefore, except for parallel imports that are exported goods falling under the category of non-VAT subjects as guided in Article 4 of Circular 219/2013/TT-BTC, other personal goods from Black Friday are still subject to VAT as per the regulations.

What date is Black Friday 2024? Are parallel imports from Black Friday subject to value-added tax in Vietnam? (Internet photo)

How to calculate the value-added tax on parallel imports from Black Friday 2024 in Vietnam?

The basis for VAT calculation on parallel imports from Black Friday is the taxable price and the tax rate.

According to Clause 2, Article 7 of Circular 219/2013/TT-BTC, the taxable price for parallel imports from Black Friday or imported goods is stipulated as follows:

Taxable Price

1. For goods and services produced and sold by business establishments, the taxable price is the selling price not inclusive of VAT. For goods and services subject to special consumption tax, the taxable price is the selling price inclusive of the special consumption tax but not inclusive of VAT.

For goods subject to environmental protection tax, the taxable price is the selling price inclusive of the environmental protection tax but not inclusive of VAT; for goods subject to both special consumption tax and environmental protection tax, the taxable price is the selling price inclusive of these taxes but not inclusive of VAT.

2. For imported goods, the taxable price is the import price at the border plus (+) import tax (if any), plus (+) special consumption tax (if any), plus (+) environmental protection tax (if any). The import price at the border is determined according to the regulations on the taxable price of imported goods.

In case imported goods are exempted or reduced from import tax, the taxable VAT price is the import price plus (+) the import tax determined according to the tax amount payable after exemption or reduction.

3. For products, goods, services (including those purchased externally or self-produced by businesses) used for exchange, gifts, donations, or as substitutes for wages, the taxable VAT price is the taxable price of similar or equivalent goods and services at the time these activities occur.

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Thus, the taxable price for parallel imports from Black Friday is the import price at the border plus (+) import tax (if any), plus (+) special consumption tax (if any), plus (+) environmental protection tax (if any). The import price at the border is determined according to the regulations on the taxable price of imported goods.

In cases where parallel imports from Black Friday are exempted or reduced from import tax, the taxable VAT price is the import price plus (+) the import tax determined according to the tax amount payable after exemption or reduction.

Additionally, depending on what the parallel imports from Black Friday constitute, they may either be exempt from VAT or subject to a VAT rate of 0%, 5%, or 10%.

Where is the VAT payable in Vietnam?

According to the regulations in Article 20 of Circular 219/2013/TT-BTC, the location for VAT payment is stipulated as follows:

- Taxpayers declare and pay VAT at the locality where they manufacture and conduct business.

- Taxpayers declaring and paying VAT by the deductible method who have dependent accounting production establishments located in a different province or city under Central authority from where the headquarters is located must pay VAT at the locality where the production establishment is located and at the locality where the headquarters is.

- In cases where enterprises or cooperatives applying the direct method have production premises in a province or city other than where the headquarters is located or have itinerant sales activities outside the province, the enterprise or cooperative must declare and pay VAT at a percentage on turnover for revenues generated outside the province at the locality where the production premises or itinerant sales activities are located. Enterprises and cooperatives do not have to pay VAT at the headquarters for revenues generated outside the province that have already been declared and paid taxes.

- For telecommunication service business establishments engaging in postpaid telecommunication services in localities under provincial authorities other than where the headquarters is and establishing dependent accounting branches paying VAT by the deductible method participating in postpaid telecommunication services at those localities, the telecommunication service business establishment must declare and pay VAT on postpaid telecommunication services as follows:

+ Declare VAT on postpaid telecommunication service revenue for the entire business establishment to the tax authority managing the headquarters directly.

+ Pay VAT at the locality where the headquarters is located and at the locality where there is a dependent accounting branch.

+ The payable VAT amount at the locality where there is a dependent accounting branch is determined at a rate of 2% (for postpaid telecommunication services subject to VAT at a rate of 10%) on revenue (not inclusive of VAT) from postpaid telecommunication services at the locality with the dependent accounting branch.

- The tax declaration and payment of VAT are implemented according to the provisions in the Law on Tax Administration and guiding documents executing the Law on Tax Administration.