Smuggled goods which are confiscated or destroyed will not get VAT refund

Smuggled Chinese goods seized by HCM City Customs in August of 2018. Photo: T.H

That is the guidance of the Import – Export Duty Department - General Department of Vietnam Customs for the Ho Chi Minh City Customs Department.

According to the Ho Chi Minh City Customs Department, recently, answering problems for the unit in processing VAT for imported goods that are confiscated and destroyed, Import – Export Duty Department said that the tax law does not regulate the VAT refund for imported goods that are confiscated or destroyed.

Therefore, in cases where the violated goods are still subjected to supervision of Customs authorities and forced to be destroyed and confiscated, they will not be subject to VAT refund.

The above provisions are based on the VAT Law No. 13/2008/QH12; VAT Law No.31/2013/QH13, amending and supplementing a number of articles of the VAT Law; Decree No. 209/2013/ND-CP of the Government dated 18/12/2013 stipulating specifically and guiding the implementation of some articles of the VAT Law; Circular No. 219/2013/TT-BTC of the Ministry of Finance dated 31/12/2013 guiding the implementation of the Law on VAT and Decree No. 209/2013/ND-CP of the Government dated 18/12/2013; Clause 1 of Article 49 of Circular No. 38/2015 / TT-BTC of the Ministry of Finance dated 25/3/2015 on customs procedures; customs inspection and supervision; import - export tariff and tax management for export and import goods.

It is known that, besides the above mentioned cases, previously, in the Ho Chi Minh City Customs Department there also incurred the case when H.D Trading Co, Ltd., imported goods but a violation report was made and the shipment was confiscated. However, this enterprise had already paid VAT and paid an administrative fine for the confiscated shipment. So does the company get VAT refund or not?

Pursuant to the current regulations, the Import – Export Duty Department - General Department of Vietnam Customs has also instructed the Ho Chi Minh City Customs Department to handle the above case by not refunding VAT for imported goods which were paid wrongly.