When must a household business importing packaging for product packing pay environmental protection tax in Vietnam?

When must a household business importing packaging for product packing pay environmental protection tax in Vietnam?

Based on Article 1 of Decree 69/2012/ND-CP which stipulates as follows:

Amendment and supplementation to Clause 3 Article 2 of Decree No. 67/2011/ND-CP dated August 8, 2011, of the Government of Vietnam specifying detailed guidelines for the implementation of certain articles of the Law on Environmental Protection Tax as follows:

“3. Plastic bags subject to tax (plastic bags) defined in Clause 4, Article 3 of the Law on Environmental Protection Tax are thin plastic bags with a bag shape (having a mouth, a base, walls, and can contain products) made from single layer plastic films like HDPE (high-density polyethylene resin), LDPE (low-density polyethylene), or LLDPE (linear low-density polyethylene resin), except for pre-packaged goods and plastic bags that meet the environmental friendliness criteria according to regulations of the Ministry of Natural Resources and Environment.

Pre-packaged goods referred to in this Clause (including those with and without a bag shape) comprise:

a) Pre-packaged imported goods;

b) Packaging produced or imported by organizations, households, or individuals to pack products they produce, process, or purchase for packaging or for packaging services;

c) Packaging purchased directly from producers or importers by organizations, households, or individuals for packaging products they produce, process, or purchase for packaging or for packaging services.

Therefore, according to the above regulations, regardless of the quantity imported, if the household imports packaging to pack products produced, processed, or purchased for packaging or for packaging services by that organization, household, or individual, it is still subject to the environmental protection tax.

When must a household business importing packaging for product packing pay environmental protection tax in Vietnam? (Image from the Internet)

Are plastic bags subject to tax exempt from environmental protection tax if the household business directly exports them in Vietnam?

Based on point c, clause 2, Article 4 of the Law on Environmental Protection Tax 2010, the provisions are as follows:

Non-taxable objects

1. Goods not defined in Article 3 of this Law are not subject to environmental protection tax.

2. Goods defined in Article 3 of this Law are not subject to environmental protection tax in the following cases:

a) Goods in transit or transshipment via Vietnam's border gates, borders as stipulated by law, including goods transported from the exporting country to the importing country via Vietnam's border gates without customs procedures in Vietnam and without export procedures from Vietnam; goods in transit via Vietnam's border gates, borders based on agreements signed between the Government of Vietnam and foreign governments or agreements between agencies, representatives authorized by the Government of Vietnam and foreign governments as stipulated by law;

b) Goods temporarily imported for re-export within the time limit as prescribed by law;

c) Goods produced by producers for direct export or entrusted to export businesses for exportation, except in cases where organizations, households, or individuals buy goods subject to environmental protection tax for export.

Plastic bags are not subject to environmental protection tax if they are directly exported by producers, except when organizations, households, or individuals purchase goods subject to environmental protection tax for export.

What are regulations on cases of environmental protection tax refund in Vietnam?

Based on Article 8 of Circular 152/2011/TT-BTC which stipulates the following:

Taxpayers are entitled to a refund of paid environmental protection tax in the following cases:

1. Imported goods stored at bonded warehouses and under customs supervision are re-exported abroad.

2. Imported goods sold to foreign countries through agents in Vietnam; petrol, oil sold to foreign transport vehicles on routes through Vietnamese ports or Vietnamese transport vehicles on international routes as prescribed by law.

3. Temporarily imported goods for re-export according to the temporary import for re-export business method are refunded the corresponding environmental protection tax paid on the goods re-exported.

4. Imported goods re-exported (including returned goods) abroad by the importer are refunded the environmental protection tax paid on the goods re-exported abroad.

5. Temporarily imported goods for fairs, exhibitions, and product introductions are refunded the corresponding environmental protection tax paid on the goods re-exported abroad.

The refund of environmental protection tax according to this Article is only implemented for goods actually exported. The procedures, documents, sequences, and authorities to resolve the refund of environmental protection tax for exported goods follow the regulations like those for addressing import tax refunds according to the laws on export and import taxes.