Question:
Based on document number 1744/TCHQ-GSQL dated April 22, 2011, from the General Department of Customs regarding Certificate of Origin (C/O) form D for goods under the in-situ export and import: “1. According to the announcement in document number 2497/TCHQ-TXNK dated March 23, 2011, the Ministry of Industry and Trade continues to issue C/O for in-situ export and import when requested by enterprises, from the previous time until there are other regulations. Therefore, it is suggested that units conduct checks and consider granting special preferential treatment to goods for in-situ export and import with C/O issued by organizations authorized by the Ministry of Industry and Trade, following the current regulations for imported goods with C/O issued by member countries of the ASEAN Free Trade Agreement.”
Based on the above content, we understand that in-situ export and import goods with C/O form D can still enjoy special preferential tax rates until there are different regulations.
Furthermore, on September 1, 2016, the Government issued Decree 129/2016/ND-CP. According to Article 4 of Decree 129/2016/ND-CP dated September 1, 2016, by the Government, it states: “Article 4. Conditions for Applying Special Preferential Import Tax Rates
Imported goods subject to ATIGA tax rates must meet the following conditions:
Belong to the Special Preferential Import Tax Schedule issued with this Decree;
Be imported into Vietnam from countries that are members of the ASEAN Trade in Goods Agreement, including the following countries:
… k) The Socialist Republic of Vietnam (goods from non-customs duty zones imported into the domestic market)
Be transported directly from the exporting country to Vietnam, as specified in paragraph 2 of this Article;
Comply with the provisions on the origin of goods in the ASEAN Trade in Goods Agreement, with a Certificate of Origin (C/O) in Form D as stipulated by the Ministry of Industry and Trade.”
Therefore, starting from September 1, 2016 (the effective date of Decree 129/2016/ND-CP dated September 1, 2016, by the Government), the conditions for applying special preferential tax rates are implemented according to the regulations of this Decree. Accordingly, the special preferential tax rates for imported goods in-situ only apply to cases where goods from non-customs duty zones are imported into the domestic market, with no provisions for cases of in-situ imports as specified by foreign traders.
For declarations made before the effective date of Decree 129/2016/ND-CP (September 1, 2016), we followed the guidance in document number 1744/TCHQ-GSQL dated April 22, 2011, from the General Department of Customs regarding C/O form D for in-situ export and import goods.
From December 22, 2015, to July 21, 2017, our company imported 58 shipments with in-situ import declarations and C/O form D. During the import process, due to not updating the changes in Decree 129/2016/ND-CP dated September 1, 2016, the Customs granted the special preferential tax rates as usual. In this case, we have some questions: Does our company need to supplement taxes for the declarations that were imported? If we need to supplement, does it apply only to declarations made after September 1, 2016 (the effective date of Decree 129/2016/ND-CP) or does it apply to all 58 declarations?
Answer:
According to the provisions in Article 4 of Decree 129/2016/ND-CP dated September 1, 2016, by the Government, it specifies the conditions for applying special preferential import tax rates. Accordingly, only goods imported from non-customs duty zones into the domestic market are eligible for special preferential import tax rates.
Therefore, in-situ imported goods not from non-customs duty zones to the domestic market do not meet the conditions to be eligible for special preferential tax rates.
Regarding the case of in-situ imported goods not from non-customs duty zones to the domestic market that have already enjoyed special preferential tax rates, the Ho Chi Minh City Customs Department is currently reporting to the General Department of Customs for guidance.
