Who is an excise taxpayer in Vietnam?

Who is taxpayer to excise tax in Vietnam?

According to Article 4 of the 2008 Law on excise tax, those subject to excise tax are organizations and individuals that produce, import goods, and provide services which are subject to excise tax.

In cases where organizations or individuals engaged in export business purchase goods subject to excise tax from production facilities for export but fail to export and instead consume them domestically, these organizations or individuals engaged in export business will be subject to excise tax.

Who is subject to excise tax in Vietnam? (Image from Internet)

What goods and services are subject to excise tax in Vietnam?

According to Article 2 of the 2008 Law on excise tax amended by Clause 1, Article 1 of the 2014 Amended Law on excise tax, the following goods and services are subject to excise tax:

- Goods:

+ Cigarettes, cigars, and other tobacco products used for smoking, inhaling, chewing, sniffing, and licking;

+ Alcoholic beverages;

+ Beer;

+ Automobiles with fewer than 24 seats, including vehicles that can carry both passengers and cargo of more than two rows of seats and designed with fixed partitions between the passenger and cargo sections;

+ Motorcycles with an engine capacity of over 125cm³, three-wheeled motorcycles;

+ Aircraft, yachts;

+ All types of gasoline;

+ Air conditioners with a capacity of 90,000 BTU or less;

+ Playing cards;

+ Paper votive offerings, paper goods for ceremonial purposes.

- Services:

+ Nightclub business;

+ Massage, karaoke business;

+ Casino business; electronic gaming with prizes including jackpot machines, slot machines, and similar devices;

+ Betting business;

+ Golf business including selling membership cards, golf tickets;

+ Lottery business.

Who is exempt from excise tax in Vietnam?

According to Article 3 of the 2008 Law on excise tax amended by Clause 2, Article 1 of the 2014 Amended Law on excise tax, goods subject to excise tax are exempt from this tax in the following cases:

- Goods directly exported by production facilities or sold or entrusted to other businesses for export;

- Imported goods including:

+ Humanitarian aid, non-refundable aid; gifts to state agencies, political organizations, socio-political organizations, socio-professional organizations, social organizations, socio-professional units, people's armed forces, gifts to individuals in Vietnam as prescribed by the Government of Vietnam;

+ Goods in transit or borrowed through Vietnam's border gates, goods transferred in accordance with Government regulations;

+ Goods temporarily imported for re-export and temporarily exported for re-import, exempt from import-export taxes within the time limit prescribed by the law on import-export taxes;

+ Items used by foreign organizations or individuals subject to diplomatic immunity; duty-free goods for sale in accordance with the law;

- Aircraft, yachts used for business purposes in transporting goods, passengers, tourists, and aircraft used for security and defense purposes;

- Ambulance cars; prison transport cars; funeral cars; cars designed with both seats and standing space for 24 or more people; recreation, sports vehicles not registered for circulation and not participating in traffic;

- Goods imported from abroad into duty-free zones, goods sold domestically into duty-free zones and used only within duty-free zones, goods traded between duty-free zones, except for passenger cars with fewer than 24 seats.

What is the taxable price for excise tax in Vietnam?

According to Article 6 of the 2008 Law on excise tax amended by Clause 3, Article 1 of the 2014 Amended Law on excise tax and Clause 1, Article 2 of the Law No. 106/2016/QH13, the taxable price for excise tax on goods and services is the selling price, service provision price before excise tax, environmental protection tax, and value-added tax, specified as follows:

(1) For domestically produced goods, imported goods, it is the selling price set by the production or import facility.

If goods subject to excise tax are sold to commercial businesses that are in the parent company, subsidiary relationship or subsidiaries under the same parent company as the production, import facility or commercial business, such taxable price must not be lower than a percentage specified by the Government of Vietnam compared to the average selling price of commercial businesses that directly buy from production or import facilities;

(2) For imported goods at the import stage, it is the taxable price for import plus import tax. If the imported goods are exempted or reduced from import tax, this price does not include the exempted or reduced import tax. The excise tax paid at the import stage can be deducted when determining the amount of payable excise tax for sales;

(3) For processed goods, it is the taxable price of the selling prices of the goods by the processing facility or the sales prices of equivalent products at the same sale time;

(4) For goods sold under installment or deferred payment method, it is the one-time payment price excluding interest on installments or deferred payments;

(5) For services, it is the provision price of the service business facility. The service provision price for certain cases is specified as follows:

- For golf business, it is the membership card selling price, golf ticket price, including golf playing fees and deposit fees (if any);

- For casino, electronic game with prizes, and betting business, it is the revenue from these activities minus the amount of payment to winners;

- For nightclub, massage, karaoke business, it is the revenue from business activities in nightclubs, massage facilities, karaoke;

(6) For goods and services used for exchange or internal consumption, gifts, it is the taxable price for similar or equivalent goods and services at the time of these activities.

The taxable price is calculated in Vietnamese Dong. In cases where the taxpayer earns revenue in foreign currency, it must be converted into Vietnamese Dong based on the average exchange rate on the interbank foreign currency market announced by the State Bank of Vietnam at the time of revenue generation to determine the taxable price.