Công văn 79/TCHQ-TXNK năm 2019 về chính sách thuế đối với hàng hóa nhập khẩu để sản xuất xuất khẩu do Tổng cục Hải quan ban hành

To: Oasis Garment Co. Ltd.

In response to Official Dispatch No. 1923/PC-VPCP dated 14/12/2018 from Office of the Government, which forwards Official Dispatch No. 18.1287/CV-OASIS dated 26/11/2018 from Oasis Garment Co. Ltd. (OG) enquiring about import duty on raw materials imported for export production, one or some stages of which are done by external processors, below are opinions of the General Department of Customs:

1. Exemption from import duty

Pursuant to Clause 7 Article 16 of the Law on Export and import duties No. 107/2016/QH13, Clause 1 Article 12 of the Government's Decree No. 134/2016/ND-CP dated 01/09/2016 on exemption of duty on goods imported for export production, be basis for identification of duty-free goods are specified in Clause 2 Article 12 of Decree No. 134/2016/ND-CP;

Pursuant to Clause 3 Article 33 of the Government's Decree No. 83/2013/ND-CP dated 22/7/2013 on cases in which fixed tax are imposed by customs authorities on exports and imports.

Pursuant to Clause 12 Article 1 of the Government's Decree No. 59/2018/ND-CP dated 20/4/2018, which amends Article 25 of the Decree No. 08/2015/ND-CP dated 21/01/2015, on declaration of repurposing of duty-free imports.

The General Department of Customs issued Official Dispatch No. 6353/TCHQ-TXNK dated 29/10/2018 in response to your enquiries about tax on raw materials imported for export production, one or some stages of which are done by external processors. According to the Official Dispatch:

From 01/9/2016, in case an organization or individual: Imports goods for export production and delivers part or all of the imported goods to another processor to perform one or some production stages, then receives the products for further production and then exports the finished products; Imports goods for export production has actually used imported goods for production, then hires a processor to perform one or some production stages and receives the products for further production and/or exports the finished products, these goods are not eligible for tax exemption according to Decree No. 134/2016/ND-CP (the importer does not have the ownership or the right to use equipment at a factory suitable for the goods imported for export production. Thus the imported goods delivered to the processor are not eligible for import duty exemption.

The importer shall prepare a new customs declaration. Policies on goods management and tax on imports shall be implemented when the new declaration is registered, unless the policies on management of exports and imports were fully implemented when the initial declaration was registered.

In case the repurposing is not declared as prescribed above, the customs authority shall impose fixed tax.  The basis and time for tax calculation, exchange rates, dutiable values of the imported goods on the initial declaration shall apply. The customs authority shall also charge late payment interest and impose administrative penalties (if any) for these goods.

2. Refund of import duty

Pursuant to Point d Clause 1 Article 10 of the Law on Export and import duties No. 107/2016/QH13, Clause 1 Article 36 of the Decree No. 134/2016/ND-CP on refund of import duty in case the taxpayer has paid the import duty on the goods that are initially imported to serve its production or business operation, but then used for export production and the products have been exported to a foreign country or a free trade zone; the basis for determination of eligibility for import duty refund is specified in Clause 3 Article 36 of Decree No. 134/2016/ND-CP as follows:

“a) The manufacturer of exports has a factory where exports are manufactured in Vietnam; owns or has the right to use machinery and equipment at the factory which is suitable for the raw materials, supplies and components imported for export production;

b) b) The value or quantity of imported raw materials, supplies and components on which import duty is refundable is the actual value or quantity of raw materials, supplies and components used for the manufacture of the products that are exported in reality;

c) The exported products are declared as domestic exports;

d) The manufacturer directly imports goods and exports the products or authorizes another entity to do so.

The taxpayer shall provide truthful information about the exports derived from the imported goods on the customs declaration.”

Pursuant to the aforementioned regulations, when OG repurposes part of the goods on which import duty has been paid and delivers them to a processor that performs one or some of the production stages, then receives the products from the processor for further production, they are not eligible for duty refund as prescribed in Point a Clause 3 Article 36 of Decree No. 134/2016/ND-CP, thus import duty on the imported goods delivered to the processor will not be refunded.

3. OG’s proposals

The General Department of Customs has included OG’s proposals regarding tax on goods imported for export production under Decree No. 134/2016/ND-CP in the draft amendments to the same Decree. These draft amendments are being considered by the Ministry of Justice and will be proposed by the Ministry of Finance to the Government for promulgation.

For the time being, OG shall comply with the Law on Export and import duties No. 107/2016/QH13 and Decree No. 134/2016/ND-CP and their instructional documents.

For your reference and compliance./.

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