Instruct to implement tax exemption for imported items serving Covid-19 prevention

According to the General Department of Vietnam Customs, implementing the directives of the Prime Minister at Document 197/TTg-KTTH dated February 2020, the same day, the Minister of Finance signed Decision No. 155/QĐ-BTC promulgating a list of imported items subjected to tax exemption for Covid-19 prevention.

To help provincial customs departments understand the regulations, the General Department of Vietnam Customs promulgated guidance documents.

Regarding imported goods subjected to tax exemptions under Decision 155/QD-BTC, the General Department of Vietnam Customs instructed that goods were subject to import duty exemptions including items mentioned in the list of goods eligible for import duty exemptions serving the prevention of Covid-19 virus issued together with Decision 155/QD-BTC. The import goods as mentioned above should face specialised management policies in accordance with current regulations.

Specifically, goods imported for domestic trading and consumption: For items under ordinal number 1,2,4,5 of the list of goods exempted from import tax, issued with Decision 155/QD- BTC; goods imported for production and trading in No. 3 of the list of goods eligible for import duty exemption issued with Decision No. 155/QD-BTC.

Tax exemption is applied for gift, present under the list of goods exempted from import tax, issued with Decision 155/QD- BTC dated February 7, 2020 of Minister of Finance.

Regarding dossiers and procedures of tax exemption for goods in the list issued together with Decision 155/QD-BTC complied with Article 31 of Decree 134/2016/ND-CP.

For raw materials for producing medical masks (in the 3rd item of the list promulgated with Decision No. 155/QD-BTC), customs authorities should implement import duty exemption for manufacturing enterprises importing or authorised for importing to produce. If the enterprise did not use raw material to produce medical mask or sell to another enterprise, it must be declared a new customs declaration and pay all taxes.

If enterprises failed to made new declarations and pay all taxes before changing their use purposes, they will be sanctioned in line with current regulations.

Furthermore, the General Department of Vietnam Customs instructed that, at the criteria of Code of exemption/reduction/not subject to import duty on the import declaration, the customs authority should instruct enterprises to declare according to Code XN502 - Import duty exemption for imported goods serving Covid-19 prevention.

The General Department of Vietnam Customs emphasised that for import declarations arising from February 7, 2020 to the issuance date of this letter, enterprises have declared types of declarations following inappropriate codes as instructions in the Official Dispatch, customs authority would conduct inspections and review the documents to ensure the exemptions as stipulated in Decision 155/QD-BTC.

Regarding the reporting regime, the General Department of Vietnam Customs said that enterprises importing goods eligible for tax exemption in the list issued with Decision 155/QD-BTC must report to the customs authorities where importing goods about the use of goods exempted from import duty, according to form No. 01/BCMT in the appendix enclosed with Official Letter 864/TCHQ-TXNK within 60 days of the issuance date of competent authorities' announcement of the end of the epidemic.

In case of more than 60 days from the issuance date of competent authorities' announcement of the end of the epidemic but the enterprise did not report use of goods, the customs office would make a plan for post-clearance inspection and impose penalties in accordance with regulations.

The General Department of Vietnam Customs requested the provincial Customs Department report the quantity of imported goods exempted from imported duty and the amount of tax exempted from import duty according to form No. 02/BCMT in Appendix II on the 10th day of each month to the General Department of Vietnam Customs (Import and Export Duty Department, Post-clearance audit Department), report on the amount of backlogged imported goods expemted from tax according to form No. 03/BCMT in Appendix III at least 65 days after authorities announce the end of the epidemic.

The General Department of Vietnam Customs also requested the Post-clearance Audit Department review goods on the list of goods eligible for import duty exemption serving epidemic prevention promulgated together with the Decision 155/QD-BTC of Minster of Finance and base on the report on the situation of using goods exempted from import duty according to form No. 01/BCMT, and reports on the situation of import duty exemption according to form No. 02/BCMT for conducting post-clearance audit or directing post-clearance audit branchs under provincial Customs Departments to conduct post-clearance audit for cases guided in this Official Dispatch and other cases when there were supicious signs or the quantity of imported goods increased abnormally.

The General Department of Vietnam Customs stressed that during the implementation if there was problem,the units should report back to the Import and Export Duty Department for instruction.