Enterprises need to understand tax refund procedures when implementing EVFTA

Import - export goods at Hai Phong port. Photo: N.Linh

According to Deputy Director of Import and Export Duty Department (General Department of Vietnam Customs) Dao Thu Huong, businesses should note the procedures to enjoy preferential tariffs via the EVFTA.

At the time of exportation, enterprises still have to declare the tax rates in accordance with the list of export tariff as prescribed in Decree 125/2017/ND-CP of the Government (from July 10 implement in accordance with Decree 57/2020/ND-CP).

When goods have been imported into the European market, within a year, the enterprise can submit documents to prove their exported goods have been imported into an EU member state.

"At that time, customs authorities would handle the overpaid tax for businesses, that is tax refund procedures," Huong said.

Regarding documents, enterprises must send a request document for handling of overpaid tax in accordance with procedures as prescribed in Circular 39/2018/TT-BTC. Besides that, the enterprise must supplement documents proving the transport destination is an EU member state, and the import declaration into the EU member country.

After the enterprise submits all the documents, customs authorities would guide to implement an additional declaration. If the export duty is entitled to preferential treatment in the EVFTA is lower than the tax rate in the list of export tariff, the enterprise will be refunded by the customs authorities and handle the amount of overpaid tax.

Specifically, at the EVFTA, Vietnam's commitments on export duty are as follows: Vietnam commited to abolish export duties on goods exported to the EU with a schedule of up to 15 years, except for items that are maintained export duty such as crude oil, coal (except for coking coal and coke).

The commitments on export duties in the EVFTA are essentially the same as Vietnam's commitments on export duties in the CPTPP.