Question:
In December 2015, a foreign customer signed a contract and paid an advance of $30,000 for the purchase of goods at an exchange rate of 22,400 VND. In February 2016, the company exported a batch of goods worth $70,000 at the exchange rate on the date of shipment, which was 22,500 VND.
According to Circular 200/2014/TT-BTC, the exchange rate for recording export revenue would be calculated as follows: $30,000 x 22,400 VND + $40,000 x 22,500 VND. However, on the customs declaration form for exported goods, only one exchange rate can be applied for tax calculation. So, how should our company declare the exchange rate on the customs declaration?
Answer:
At the time of tax calculation, the exchange rate for export goods is regulated in Article 35 of Circular 38/2015/TT-BTC dated March 25, 2015 “Regulations on Customs Procedures; Customs Supervision; Export Tax, Import Tax, and Tax Management on Exported and Imported Goods,” as follows:
“Article 1. Time of tax calculation, exchange rate for export and import goods
The time of export tax calculation, import tax calculation, self-defense tax, anti-dumping tax, countervailing duty (during the effective period of the Minister of Industry and Trade’s Decision on application) is the date of registration of the customs declaration. Export tax and import tax are calculated based on the tax rates, the taxable value, and the exchange rate at the time of tax calculation.
In cases where the taxpayer declares and calculates tax on the customs declaration form before the date of registration of the customs declaration but with a different exchange rate from the one applied at the time of registration, the customs authority shall recalculate the tax amount to be paid based on the exchange rate applied at the time of registration.
The exchange rate for tax calculation is determined in accordance with the provisions of Decree 08/2015/ND-CP.
a) The General Department of Customs shall coordinate with the Joint Stock Commercial Bank for Foreign Trade of Vietnam to update the exchange rates of foreign currencies purchased by the head office by transfer at the end of the day on Thursday or the end of the working day immediately preceding Thursday if Thursday is a holiday or a day off; announce this exchange rate on the electronic information portal of the General Department of Customs and update it in the electronic customs data system to apply and determine the tax calculation exchange rate for customs declarations registered in the following consecutive week;
b) For foreign currencies that are not publicly announced by the Head Office of the Joint Stock Commercial Bank for Foreign Trade of Vietnam, the General Department of Customs shall update the exchange rates announced by the State Bank of Vietnam as the latest news on the State Bank of Vietnam’s website to announce on the electronic information portal of the General Department of Customs and update it in the electronic customs data system to apply and determine the tax calculation exchange rate for exported and imported goods.”
– Companies should base their tax calculation on the above regulations.
– To determine the exchange rate for declaring VAT at the local tax authority, we recommend that the company contact the tax authority for guidance.
