Imported Components for Shipbuilding Activities: Are Import Taxes Refundable Upon Export?
Are imported components for shipbuilding and ships for export exempt from import duties?
Based on Article 17 of Decree 134/2016/ND-CP, which stipulates the exemption from taxes for imported goods used in shipbuilding and export shipping as follows:
Exemption from import duty on goods used in shipbuilding and export shipping
1. Projects and shipyards listed in the sector and occupation list eligible for incentives as prescribed by the investment law are exempt from import and export duties as stipulated in Clause 16, Article 16 of the Law on Export and Import Duties.
2. The basis for determining the means of transport in the production line serving directly for shipbuilding activities shall comply with the provisions of the Ministry of Science and Technology.
3. The basis for determining goods not yet produced domestically shall comply with the provisions of the Ministry of Planning and Investment.
Wherein, Clause 16, Article 16 of the Law on Export and Import Duties 2016 stipulates as follows:
Tax Exemption
...
16. Projects and shipyards listed in the sector and occupation list eligible for incentives as prescribed by the investment law are exempt from taxes for:
a) Imported goods to create fixed assets of the shipyard, including: machinery and equipment; components, parts, rickets, spare parts for assembly or use with machines and equipment; raw materials and supplies used to manufacture machinery and equipment or to manufacture components, parts, rickets, spare parts for machinery and equipment; means of transport in the production line directly serving for shipbuilding activities; construction materials not yet produced domestically;
b) Imported goods are machinery, equipment, raw materials, supplies, components, semi-finished products not yet produced domestically serving shipbuilding;
Thus, import components to serve shipbuilding and export shipping fall under the cases exempt from import duties as prescribed by law.
Are import components to serve shipbuilding refunded import duties after being exported? (Image from the Internet)
What is the procedure for tax exemption for the import of components for shipbuilding and export shipping?
According to the provisions of Clause 3, Article 31 of Decree 134/2016/ND-CP as amended and supplemented Clause 14, Article 1 of Decree 18/2021/ND-CP on tax exemption procedures as follows:
Dossier and procedures for tax exemption when carrying out customs procedures
...
3. Tax exemption procedures:
a) Taxpayers self-determine and declare goods and the amount of tax exemption (except for declaring the amount of tax payable for goods for export and import for processing as provided by the processing tax side) on the customs declaration when carrying out customs procedures and take responsibility before the law for the declared contents.
b) The customs office where the customs procedures are carried out shall base on the tax exemption dossier, compare with the current regulations to exempt tax as prescribed.
In cases where imported goods are determined not to fall under the tax exemption as declared, tax collection and sanctioning for violations (if any) shall be carried out according to regulations.
c) The electronic data processing system automatically deducts the quantity of goods exported, imported corresponding to the quantity of goods in the tax exemption list.
In case of notification of the tax exemption list in paper form, the customs office shall update and deduct the exported and imported quantities of goods in accordance with the quantity of goods in the tax exemption list.
In the case of tax-free import of goods by assembly lines, tax clearance must be carried out at the customs office where the machinery and equipment are installed. At the time of registering the customs declaration, taxpayers must declare the detailed goods on the customs declaration. If detailed declaration is not possible on the customs declaration, the taxpayer shall make a detailed list of imported goods according to the information criteria specified in Form No. 04 Appendix VIIa issued together with this Decree through the electronic data processing system or according to Form No. 15 Appendix VII issued together with this Decree and attach the customs declaration. Within 15 days from the end of importing the last batch of each assembly line, the taxpayer is responsible for notifying the customs office where the tax exemption list is notified according to the information criteria specified in Form No. 05 Appendix VIIa issued together with this Decree through the electronic data processing system or according to Form No. 16 Appendix VII issued together with this Decree.
Thus, tax exemption procedures when carrying out customs procedures must follow the above regulations.
Are imported components for shipbuilding refunded import duties after being exported?
Based on Article 36 of Decree 134/2016/ND-CP stipulating the tax refund for imported goods used for production and business after exporting products:
Tax refund for imported goods used for production and business but have exported the products
1. Taxpayers who have paid import duties for goods imported for production and business but have brought them into production of exported goods and have exported the products abroad, or exported into non-tariff zones, are entitled to a refund of the paid import duties.
2. The imported goods entitled to import duty refund include:
a) Raw materials, supplies (including materials for packaging or packaging to pack exported products), components, semi-finished products directly constituting the exported product or directly participating in the export production process but not directly transforming into goods;
b) Finished products imported for attachment, assembly into export products, or packaged together into a synchronous item with export products;
c) Imported components and spare parts for the warranty of export products.
...
4. In the case of a type of imported raw materials, supplies, components for production yielding two or more different products and only one product is exported, the import duty refund shall be calculated on the part of raw materials, supplies, components constituting the exported product based on the total value of all products obtained.
Thus, imported components for shipbuilding under these provisions will be refunded the import duties.
LawNet
