Recently, the General Department of Customs issued Official Dispatch 693/TCHQ-TXNK dated February 5, 2021 on tax treatment of exported processed goods that must be re-imported in Vietnam
Article table of contents
Instructions for tax settlement on exported processed goods that must be re-imported in Vietnam (Illustration)
Based on the provisions of Clause 6, Article 16 and Point b, Clause 1, Article 19 of Vietnam's Law on Import and Export Tax 2016, Article 10 and Article 33 of Decree 134/2016/ND-CP, Article 47 of Decree 08 /2015/ND-CP, Clause 39, Article 1 of Circular 39/2018/TT-BTC amending and supplementing Article 60 of Circular 38/2015/TT-BTC, tax treatment for exported processed products but must be re-imported for repair, recycling is done as follows:
(1) Tax settlement at the stage of re-import in Vietnam
When re-importing processed products for repair or recycling, the customs authority shall not collect import tax if, at the time of carrying out re-import procedures, the customs declarant submits a complete set of dossiers of tax exemption as prescribed; the enterprise is entitled to a refund of the paid export tax amount (if any).
Enterprises record the amount of processed products that must be re-imported into the final settlement report at entry 26.10 (Amount of products in stock during the period), write the number of the re-import declaration in entry 26.13 (Note) Form No. 26 Appendix I promulgated together with Circular 39/2018/TT-BTC. In the case of paper records, the enterprise shall record the quantity of processed products re-imported in the final settlement report in column 6 (Amount of products in stock during the period), write the number of the re-import declaration in column 11 (Note) Form No. 15a/BCQT-SP/GSQL Appendix II issued together with Circular 39/2018/TT-BTC.
(2) Tax settlement at the stage of re-export in Vietnam
For processed products that are re-imported for repair or recycling upon re-export, if the enterprise has been refunded the export tax at the stage of re-import, the enterprise must pay export tax as in the case of the first export.
Enterprises record the quantity of processed products for re-export at target 26.11.2 (Manufacturing products for export), write the number of declarations for re-export in target 26.13 (Note) Form No. 26 Appendix I issued with the Circular April 39/2018/TT-BTC. In the case of paper documents, the enterprise shall record the quantity of processed products for re-export in the final settlement report in column 8 (Quantity of exported products), write the number of the re-export declaration in column 11 (Note) Form No. 15a/BCQT-SP/GSQL Appendix II issued together with Circular 39/2018/TT-BTC.
(3) Tax settlement for cases where the re-import period is 275 days past the time limit for re-export in Vietnam
If the re-import period is over 275 days registered with the customs authority but the enterprise has not re-exported, the quantity of processed products re-imported will continue to be monitored on the final settlement report until they are actually re-exported. Tax treatment when processed products are re-exported shall comply with the instructions in item (2) above.
If processed products are re-imported but cannot be re-exported but are sold domestically, taxpayers shall declare the change of use purpose for imported raw materials, materials, and supplies that have been used for the production of processed goods for export but have been sold domestically according to the provisions of Article 25 of the Decree 08/2015/ND-CP (amended and supplemented in Clause 12, Article 1 of Decree 59/2018/ND-CP).
