What is the environmental protection tax in Vietnam?

What is the environmental protection tax in Vietnam?

According to Clause 1, Article 2 of the Law on Environmental Protection Tax 2010, the environmental protection tax means an indirect-collected tax, collected on products and goods (hereafter referred to as goods) when used to cause negative environmental impacts.

>>> Download the complete set of documents on environmental protection tax payment.

In case of entrusting import of goods, who is responsible for paying the environmental protection tax in Vietnam?

Article 5 of the Law on Environmental Protection Tax 2010 stipulates taxpayers as follows:

Taxpayer

1. Environmental protection taxpayer is organizations, households and individuals producing, importing goods under taxable subject provided for in Article 3 of this Law.

2. Environmental protection taxpayer in some specific cases shall be provided for as follows:

a) in case of entrusting import of goods, the person who entrusted importing goods shall be taxpayer;

b) In cases where organizations, households and individuals act procurement hub of coal to develop small, retail but they can not produce the documents proving that goods have been paying environmental protection tax, the organizations, households individuals act as procurement hub shall be taxpayer.

Thus, in case of entrusting import of goods, the person who entrusted importing goods shall be taxpayer.

What is the formula for calculating the environmental protection tax in Vietnam?

The formula for calculating the environmental protection tax is based on the following:

*Tax basis (Article 6 of the Law on Environmental Protection Tax 2010)

- Tax base of environmental protection is the number of taxable goods and absolute rate.

- The number of taxable goods shall be provided for as follows:

+ For goods produced in the country, the number of taxable goods is the quantity of goods produced and sold, exchanged, internally consumed, donated;

+ For imported goods, the number of taxable goods is the quantity of imported goods.

- Absolute rate for tax calculation specified in Article 8 of Law on Environmental Protection Tax 2010.

*Tax calculation method (Article 7 of the Law on Environmental Protection Tax 2010)

The amount of environmental protection tax payable equal the quantity of unit of dutiable goods multiply absolute rate specified on a unit of goods.

The tax calculation formula is guided in Article 4 of Circular 152/2011/TT-BTC as follows:

Environmental protection tax payable = Quantity of taxable goods x Absolute tax amount per unit of goods.

What is the environmental protection tax in Vietnam? (Image from the Internet)

What is the place for paying the environmental protection tax in Vietnam?

According to Article 10 of the Law on Environmental Protection Tax 2010, tax declaration, payment, and calculation are stipulated as follows:

- The tax declaration, tax calculation, tax payment for environmental protection on goods produced and sold, exchanged, internally consumed, donated shall be made by the month and the provisions of the law on tax administration.

- The tax declaration, tax calculation, tax payment for environmental protection on imported goods shall be made at the same to time of import tax declaration and tax payment.

- Environmental protection tax is only paid once for goods produced or imported.

Under Article 10 of the Law on Environmental Protection Tax 2010 guided by the tax payment method stipulated in Article 5 of Decree 67/2011/ND-CP, the following regulations apply:

- For the goods which are produced for selling, exchanging, internal consumption, gifting, the tax declaration, tax calculation, and tax payment are conducted monthly. For imported goods, entrusted imports, the tax declaration, tax calculation, and tax payment are conducted by each time of arising.

- Declaration, calculation and payment of environmental protection taxes for gasoline, oil, grease: Hubs companies of gasoline and oil shall declare and pay environmental protection taxes and the state budget for the delivered, sold gasoline and oil (including delivery for internal consumption, delivery for exchange with other commodities, the delivery for returning entrusted imports, for sales to other organizations, individuals, except for selling for other hubs company of trading gasoline and oil) at the local where the value added tax is declared and paid.

Ministry of Finance stimulates the hubs companies to declare, pay environmental protection tax for gasoline and oil.

- Declaration, calculation and payment for environmental protection tax for coal shall follow the principles: coal for domestic consumption must be declared and paid environmental protection tax; coal for export is not subject to environmental protection tax. Ministry of Finance shall preside over and coordinate with the Ministry of Industry and Trade in guiding specifically the provisions in this Clause.

- Environmental protection tax shall be paid only once for goods produced or imported. In case the exported goods has been paid for environmental protection tax, but re-imported into Vietnam, such re-imported goods shall not be paid environmental protection tax upon importation.

Therefore, the payment of environmental protection tax depends on the type of product being traded. For instance, if trading gasoline, the tax may be paid at the place where the tax is declared.