According to regulations, the processed products that are imported and then processed in Vietnam for export are not subject to an import tax refund.
The country’s top customs regulator cites Article 19 of the Law on Import and Export Duty as saying that cases of tax refund are below:
- Any taxpayer who has paid export duty or import duty but has no exports or imports, or the number of exports or imports is smaller than the quantity on which duty is paid;
- Any taxpayer who has paid export duty but the exports have to be re-imported will receive a refund of export duty and does not have to pay import duty;
- Any taxpayer who has paid import duty but the imports have to be re-exported will receive a refund of import duty and does not have to pay export duty;
- Any taxpayer who has paid tax on goods imported to serve manufacture or business operation and they have been used for the manufacture of exports and the products are already exported.
- Any taxpayer who has paid tax on machinery, equipment, tools, vehicles of organizations and individuals that are permitted to be temporarily imported for re-export, except for those rented to execute investment projects, construction and installation, manufacture, when they are re-exported to abroad or exported to a free trade zone.
Accordingly, these products are eligible for tax refund when they have not been used, processed, and tax refund procedures will comply with the provisions of the Law on Tax Administration.
In addition, the General Department of Vietnam Customs said that Point a4, Clause 2, Article 12 of Decree 134/2016/ND-CP amended and supplemented in Clause 6, Article 1 of Decree 18/2021/ND-CP, stipulated that imported goods and semi-finished products made from imported goods for outsourcing at non-tariff zones or abroad described in the following cases at Points a.1, a.2, a.3 Clause 2 Article 12 are exempt from export tax.
Therefore, the outsourced products abroad must pay import tax when they are re-imported to Vietnam. The outsourced products at non-tariff zones also must pay import tax when they are sold in the Vietnamese market.
Source: Customs News