Is level of tax reduction proportional to the loss of goods in Vietnam?

Is level of tax reduction proportional to the loss of goods in Vietnam?

Article 18 of the Law on Export Tax and Import Tax 2016 stipulates:

1. Exports and imports that are damaged or lost under customs supervision and the damage or loss is verified by a competent organization, tax reduction shall be granted.

The level of reduction shall be proportional to the loss of goods. Tax is exempt if the exports or imports are completely damaged or lost.

2. The procedures for tax reduction shall comply with regulations of law on tax administration.

Based on the above regulations in Vietnam, your company will be considered for import tax reduction corresponding to the loss of this imported glass shipment. In case the entire batch of glass goods above is completely damaged, the company does not have to pay tax in Vietnam.

Is level of tax reduction proportional to the loss of goods in Vietnam? (Image from the Internet)

What are procedures and documents for granting duty reduction in Vietnam?

According to Clause 2, Article 32 of Decree 134/2016/ND-CP amended by Clause 16, Article 1 of Decree 18/2021/ND-CP, the tax reduction request dossier includes:

2. An application for duty reduction consists of:

a) The written request form sent via the electronic data processing system of the customs authority according to Form No. 3 in Appendix VIIa or Form No. 08 in Appendix VII hereof: 01 original copy;

b) The insurance contract or insurance payout notice issued by the insurer (if any), or the insurer’s confirmation if the insurance contract does not cover tax indemnification; the contract or agreement on compensation issued by the shipping company in case the damage is caused by the shipping company (if any): 01 photocopy;

c) A confirmation of damage issued by a local authority e.g. confirmation of conflagration issued by the local fire department, confirmation issued by one of the following bodies: police authority of the commune, the People’s Committee of the commune; management board of the industrial zone, export processing zone or economic zone; border checkpoint management board; port authority, airport authority where the force majeure event (natural disaster, epidemic, accident) occurs and causes damage to the imported materials or equipment: 01 original copy.

d) Confirmation of loss or damage of goods issued by an assessment service provider: 01 original copy.

According to Clause 3, Article 32 of Decree 134/2016/ND-CP amended by Clause 16, Article 1 of Decree 18/2021/ND-CP on tax reduction procedures as follows:

3. Procedures and authority for granting duty reduction:

c) If the application for duty reduction is submitted after customs procedures are completed:

Within 30 days from the receipt of the satisfactory application, the Customs Department of the province shall compile a dossier, verify the information, inspect the accuracy and adequacy of the application and issue a duty reduction decision according to Form No. 12 in Appendix VII hereof or inform the taxpayer of their ineligibility for duty reduction and the duty payable. If the application is not satisfactory, the customs authority shall inform the taxpayer within 03 working days from the day on which the application is received.

If a physical inspection of goods that have been released from the customs controlled area is necessary basis for duty reduction, a decision on post-clearance inspection shall be delivered to the taxpayer and the tasks specified in this Point shall be carried out within 40 days from the day on which adequate documents are received.

Best regards!