What is temporary import? Are temporary imports subject to excise tax in Vietnam?

What is temporary import in Vietnam?

Pursuant to Article 29 of the 2005 Commercial Law (Clause 3 repealed by Clause 3, Article 112 of the 2017 Foreign Trade Management Law), regulations on temporary import, temporary export of goods are as follows:

Temporary import, temporary export of goods

1. Temporary import of goods means that goods are brought from abroad or from special areas located within the territory of Vietnam considered to be separate customs areas, in accordance with the law, into Vietnam, having completed import procedures into Vietnam, and then exported back out of Vietnam.

2. Temporary export of goods means that goods are brought abroad or into special areas located within the territory of Vietnam considered to be separate customs areas, in accordance with the law, having completed export procedures out of Vietnam, and then re-imported back into Vietnam.

Thus, it can be understood that temporary import is the process of importing goods from abroad into Vietnam for temporary use, and then exporting those goods back abroad.

What is temporary import? Are temporary imports subject to excise tax in Vietnam? (Picture from the Internet)

What are the conditions for temporarily importing goods into Vietnam for display and introduction?

Pursuant to Article 121 of the 2005 Commercial Law, the conditions are as follows:

- Goods and services for display and introduction must be legally traded in the market.

- Goods and services for display and introduction must comply with the regulations of the law regarding quality and labeling of goods.

Simultaneously, pursuant to Article 122 of the 2005 Commercial Law, goods imported into Vietnam for display and introduction must meet, besides the conditions stipulated in Article 121, the following additional conditions:

- The goods must be legally permitted to be imported into Vietnam;

- temporary imports for display and introduction must be re-exported after the display or introduction period, but not exceeding six months from the date of temporary import; if this period is exceeded, an extension must be applied for at the customs office where the temporary import was carried out;

- temporary imports for display and introduction, if consumed in Vietnam, must comply with the regulations of Vietnamese law regarding imports.

*Note: The prohibitions for displaying and introducing goods and services as stipulated in Article 123 of the 2005 Commercial Law are as follows:

- Organizing the display and introduction of goods and services or using forms, means of display and introduction of goods and services that harm national security, public safety, social order, landscape, environment, and human health.

- Displaying and introducing goods and services or using forms, means of displaying and introducing contrary to Vietnam’s historical traditions, culture, ethics, and customs.

- Displaying and introducing goods and services that expose state secrets.

- Displaying and introducing goods from other traders for comparison with one’s own goods, except in cases where the goods being compared are counterfeit or infringe on intellectual property rights as stipulated by law.

- Displaying samples of goods that do not match the quality, price, usage, design, type, packaging, warranty period, and other quality indicators with the goods currently being traded, aiming to deceive customers.

Are temporary imports subject to excise tax in Vietnam?

Goods temporarily imported are regulated in Clause 2, Article 3 of Circular 195/2015/TT-BTC, as follows:

Objects not subject to tax

...

2. Goods imported in the following cases:

...

2.3. temporary imports, if actually re-exported within the time limit without being subject to import tax as regulated by the law on export and import tax, are not subject to excise tax corresponding to the amount of goods actually re-exported.

Temporarily exported goods for re-import, if actually re-imported within the time limit without being subject to export tax as regulated by the law on export and import tax, are not subject to excise tax corresponding to the amount of goods actually re-imported.

2.4. temporary imports for fairs or exhibitions, if actually re-exported within the time limit not yet subject to import tax as per policies stipulated, are not subject to tax.

At the end of the fair or exhibition period, if organizations or individuals do not re-export the temporary imports, they must declare and pay excise tax; if organizations or individuals fail to declare and are inspected and detected, they will not only be required to pay back taxes but also be penalized in accordance with the law.

...

Thus, under the above regulations, temporary imports will not incur excise tax corresponding to the amount of goods actually re-exported if re-exported within the time limit that does not require the payment of import tax in accordance with the law on export and import tax.