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MINISTRY OF FINANCE
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SOCIALIST REPUBLIC OF VIETNAM
Independence - Freedom - Happiness
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No. 195/2015/TT- BTC
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Hanoi, November 24, 2015
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CIRCULAR
GUIDELINES FOR THE GOVERNMENT'S DECREE NO. 108/2015/ND-CP DATED DECEMBER 28, 2015 ON GUIDELINES FOR SOME ARTICLE OF THE LAW ON SPECIAL EXCISE DUTY AND THE LAW ON AMENDMENTS TO THE LAW ON SPECIAL EXCISE DUTY
Pursuant to the Law on special excise duty No. 27/2008/QH12 dated November 14, 2008; Law No. 70/2014/QH13 dated November 26, 2014 on amendments to some Articles of the Law on special excise duty;
Pursuant to the Law on Tax administration No. 78/2006/QH11 dated November 29, 2006; Law No. 21/2012/QH13 dated November 20, 2012 on amendments to some Article of the Law on Tax administration;
Pursuant to the law No. 71/2014/QH13 dated November 26, 2014 on amendments to tax laws;
Pursuant to the Government's Decree No. 108/2015/ND-CP dated October 28, 2015 providing guidelines for some Article of the Law on special excise duty and the Law on Amendments to the Law on special excise duty;
Pursuant to the Government's Decree No. 215/2013/ND-CP dated December 23, 2013 defining the functions, tasks, entitlements and organizational structure of the Ministry of Finance;
At the request of the Director of the General Department of Taxation,
The Minister of Finance provides guidelines for the Government's Decree No. 108/2015/ND-CP dated October 28, 2015 (hereinafter referred to as Decree No. 108/2015/ND-CP) below:
Chapter I
GENERAL PROVISIONS
Article 1. Scope
This Circular provides guidelines for the Government's Decree No. 108/2015/ND-CP dated December 28, 2015 on guidelines for some Article of the Law on special excise duty and the Law on Amendments to the Law on special excise duty.
Article 2. Taxed commodities
Commodities subject to special excise tax (SET) are specified in Article 2 of the Law on special excise duty No. 27/2008/QH12 dated November 14, 2008, Clause 1 Article 1 of the Law No. 70/2014/QH13 dated November 26, 2014 on amendments to the Law on special excise duty, and Article 2 of Decree No. 108/2015/ND-CP.
With regard to air conditioners of 90,000 BTU or lower that are subject to SET: if the indoor and outdoor units are sold or imported separately, they are still subject to SET as if complete products (air conditioners).
Article 3. Commodities not subject to SET
The goods specified in Article 2 of this Circular are not subject to SET in the following cases:
1. Goods directly sold by the manufacturer or processor, or sold to another business establishment for export, including:
1.1. Goods directly exported by the manufacturer or processor, including goods sold to or processed for export processing companies, except for passenger cars having fewer than 24 seats sold to export processing companies.
Any organizations having goods not subject to SET specified in this Point must have documents proving that such goods have been exported. To be specific:
- Sale contract or processing contract with foreign parties.
- Invoices for goods export or return, payment for processing.
- Export declaration.
- Bank transfer receipts.
Bank transfer means the transfer of money from the importing party’s account to an account held by the exporting party opened at a bank in accordance with contract agreements and regulations of the bank. The bank transfer receipt is the credit note of the exporting party’s bank of the amount of money transferred from the importing party’s bank. In case of deferred payment, it must be specified in the export contract and the bank transfer receipt must be submitted when the payment is due. In case of export entrustment, the entrusted party must pay the foreign party via a bank.
1.2. A manufacturer of goods subject to SET that temporarily exports and re-imports goods under a license for temporary export is not required to pay SET during the period over which import and export duties are exempt and has to pay SET when selling such goods.
1.3. Goods exported for sale or exported by an entrusted business establishment under a business contract.
Any organizations having goods not subject to SET specified in this Point must have documents proving that such goods have been exported. To be specific:
- A contract to buy goods for export or, if the manufacturer entrusts a business establishment to export goods, an export entrustment contract.
- Invoices for sale, delivery of goods exported under an entrustment contract.
- A record on partial or full finalization of the contract to sell goods for export, record on finalization of the import entrustment contract must specify:
Names, quantities, categories, prices of goods that have been exported; method of payment, amount of money, date of the receipt for bank transfer from the foreign buyer to the exporter; amount of money and date of the payment document between the manufacturer and exporter or entrusted exporter; number, date of the export contract; copies of the customs declaration of exported goods.
With regard to goods bought or received by an exporter for export but eventually sold domestically instead of being exported, the exporter must declare and pay SET on such goods when they are sold domestically.
1.4. Goods for sale at overseas fairs or exhibitions.
The organization hose goods are put up for sale at overseas fairs or exhibitions must have:
- An invitation or registration for participation in the overseas fair or exhibition.
- An export declaration bearing the customs authority’s certification that goods have been exported.
- A list of goods put up for sale at the fair or exhibition.
- Documents about payment for goods sold at the fair or exhibition. It is required to submit a declaration to the customs authority and present the receipt for bank deposit if the amount of cash exceeds the permissible limit.
2. Imported goods in the following cases:
2.1. Humanitarian aid, grant aid, gifts, including:
a) Humanitarian aid and grant aid, including imported goods funded by grant aid approved by a competent authority; humanitarian aid and emergency assistance for recovery from wars, natural disasters, epidemics.
b) Gifts of overseas entities for state agencies, political organizations, socio-political organizations, socio-political-professional organizations, social organizations, socio-professional organizations, the people’s armed forces.
c) Gifts for Vietnamese individuals within the allowance imposed by law.
2.2. Goods transited through Vietnam, including:
a) Goods transported from the exporting country to the importing country through Vietnam’s checkpoint without following procedures for import into Vietnam and procedures for export from Vietnam.
b) Goods transported from the exporting country to the importing country through Vietnam’s checkpoint and moved to a bonded warehouse without following procedures for import into Vietnam and procedures for export from Vietnam.
c) Goods transited through Vietnam’s border checkpoint or border under an International Agreement between Vietnam and another country or between the agencies and representatives authorized by Vietnam’s government and the other country’s government.
d) Goods transported from the exporting country to the importing country passing through Vietnam’s checkpoint.
2.3. If temporarily imported goods are re-exported within the period over which import duties are exempt according to regulations of law on export and import duties, SET on the re-exported goods shall not be paid.
If temporarily exported goods are re-imported within the period over which export duties are exempt according to regulations of law on export and import duties, SET on the re-imported goods shall not be paid.
2.4. Goods temporarily imported to attend a fair or exhibition and re-exported within the period over which import duties are exempt. If such goods are not re-exported after the end of the fair or exhibition, SET shall be paid. If the tax authority finds that a taxpayer fails to declare such amount of SET, such tax payer shall incur penalties in addition to paying the tax arrears.
2.5. Personal belongings of foreign entities given diplomatic immunity according to regulations of law on diplomatic immunity.
2.6. Hand luggage within the tax-free allowance of Vietnamese people and foreigners when passing through a Vietnam’s checkpoint.
2.7. Imported goods for sale at tax-free shops as prescribed by law.
3. Goods imported from abroad into a free trade zone, goods sold to a free trade zone from inland and used within the free trade zone, goods traded between free trade zones, except for: goods taken into a free trade zone having residents, not hard fences, and passenger cars having fewer than 24 seats.
Documentation and procedures for canceling SET in the cases specified in Clause 2 and Clause 3 of this Article are similar to those for cancellation and exemption of import duties in accordance with regulations of law on export and import duties.
If imported goods that are not subject to SET at importation as specified in Clause 2 and Clause 3 of this Article are used for other purposes, SET shall be paid to the customs authority in accordance with instructions of the Ministry of Finance on customs procedures, customs supervision, export and import duties, and tax administration applicable to exported and imported goods.
4. Aircraft, cruise ships used for passenger transport, cargo transport, and tourism services, and aircraft serving national defense and security purposes.
If aircraft and cruise ships that are not subject to SET are used for purposes other than passenger transport, cargo transport, tourism services, national defense and security purposes, they are subject to SET.
Any business establishment having imported aircraft and/or cruise ships that are repurposed as specified above shall declare and pay SET to the customs authority in accordance with instructions of the Ministry of Finance on customs procedures, customs supervision, export and import duties, and tax administration applicable to exported or imported goods.
Any business establishment having domestically produced aircraft and/or cruise ships that are repurposed as specified above shall declare and pay SET on the remaining value after depreciation to the its supervisory tax authority.
5. The Ministry of Finance shall cooperate with relevant Ministries and agencies in providing specific guidance on motor vehicles specified in Clause 4 Article 3 of the Law on special excise duty that are designed by manufacturers to be used as ambulances, prisoner transport vehicles, hearses; vehicles for inspection and control of radio frequencies; armored mobile adjustable ramp systems; mobile video production vehicles; vehicles designed to carry both seated and standing passengers and capable of carrying 24 people or more, cars running within amusement parks and sport centers and exempt from registration and banned from public roads, other specialized vehicles, vehicles exempt from registration, and vehicles banned from public roads.
Importers of cars running within an amusement park or sports center, exempt from registration and banned from public roads, and thus not subject to SET as specified in Clause 5 of this Article must present the following documents to the customs authority where the import declaration is registered:
- Copies of the Certificate of Business Registration which permits the importer to operate the amusement park or sports center (bearing the importer’s signature and seal).
- The importer must specify on the import declaration that “The vehicle is designed exclusively for use within the amusement park or sports stadium, exempt from registration and banned from public roads”. The importer is responsible for the truthfulness of import documents.
The customs authority with which the importer registers the import declaration shall inspect goods, not collect SET on such goods, and not issue the Certificate of Origin of Imported Vehicle to the importer.
If the vehicles specified in Clause 5 of this Article is repurposed after import procedures are complete, they will be subject to SET and the importer must declare and pay SET to the customs authority in accordance with instructions of the Ministry of Finance on customs procedures, customs supervision, export and import duties, and tax administration applicable to exported or imported goods. If the importer fails to declare such repurposing, the importer shall incur penalties specified in the Law on Tax administration and its instructional documents.
6. Air conditioners of 90,000 BTU or lower and designed to be installed on vehicles only, including cars, railway carriages, ships, boats, airplanes.
Where a business establishment imports or entrusts the import of a central air-conditioning system of over 90,000 BTU, or an importer signs a contract with a Vietnamese building contractor for installation of a central air-conditioning unit of over 90,000 BTU, the delivery varies according to the construction progress (the system is divided into multiple shipments) in order to avoid imposition of SET on separate parts of the system (such as the outdoor unit and indoor unit), the following must be presented to the customs authority:
- An import contract (and import entrustment contract in case of import entrustment) or sale contract (original or copy bearing the importer’s seal) for the central air-conditioning system with a Vietnamese building contractor; the contract must demonstrate that the system is integrated, has a power of over 90,000 BTU, and is imported as a completely built unit according to the manufacturer’s standards, and enclosed with a list of parts of the system.
- A diagram of the central air-conditioning unit connection certified by the importer and the building contractor (if any).
- Certificate of power and integration of imported device and that separate parts (indoor unit and outdoor unit) or groups of separate parts of the system cannot operate independently issued by a competent agency.
If one or some separate parts can be assembled into a complete air-conditioner of 90,000 BTU or lower that can operate independently without connection to the system, each of those parts are subject to SET.
- The importer’s commitment to use imported goods for proper purposes and take responsibility for such commitment.
In consideration of the importer’s documents, the customs authority shall issue a monitoring sheet according to Appendix I to this Circular.
Article 4. Taxpayers
1. SET payers are organizations and individuals that manufacture, import goods and provide services subject to SET, including:
1.1. Business organizations established and registered in accordance with the Law on Enterprises, the Law on State enterprises (now the Law on Enterprises), and the Law on Cooperatives.
1.2. Business organizations of political organizations, socio-political organizations, socio-political-professional organizations, social organizations, socio-professional organizations, the people’s armed forces, and other organizations.
1.3. Foreign-owned enterprises and foreign parties to business cooperation under the Law on Foreign investment in Vietnam (now the Law on Investment); foreign entities doing business in Vietnam without establishing legal entities in Vietnam.
1.4. Individuals, households, groups of independent businesspeople, and other entities engaged in manufacturing, business, import.
2. Exporters that buy goods subject to SET from their manufacturers for export but eventually sell them domestically. When selling goods, such exporters must fully declare and pay SET.
Chapter II
TAX BASIS
Article 5. Taxable price
The price as the basis for calculating SET on a commodity or service (hereinafter referred to as taxable price) is the selling price for the commodity or service exclusive of SET, environmental protection tax, (if any), and VAT.
1. VAT on imported goods (except for gasoline) sold by the importer and domestically produced goods is calculated as follows:
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Taxable price
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=
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Selling price exclusive of VAT
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-
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Environmental protection tax (if any)
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1 + SET rate
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The selling price exclusive of VAT is determined in accordance with regulations of law on VAT; environmental protection tax is determined in accordance with regulations of law on environmental protection tax.
a) Where a trader imports goods subject to SET (except for gasoline), a manufacturer of goods subject to SET sells goods via its financially dependent subsidiaries, the taxable price is the selling price imposed by such subsidiaries. Goods sold by an agent at prices fixed by the importer (except for importers of gasoline) or manufacturer (the agents only receive commissions), taxable prices are the prices imposed by the importer or manufacturers inclusive of commissions.
b) Where an importer of goods subject to SET (except for cars having fewer than 24 seats and gasoline), or a manufacturer of goods subject to SET (except for cars having fewer than 24 seats) sells such goods to trading establishments, taxable prices are selling prices imposed by such importer or manufacturer and must not fall below 7% of the average price of products sold by the trading establishments in the month.
If the selling prices imposed by the importer of goods subject to SET (except for cars having fewer than 24 seats and gasoline), or a manufacturer of goods subject to SET (except for cars having fewer than 24 seats) fall below 7% of the average price of products sold by the trading establishments in the month, the taxable price shall be imposed by a tax authority in accordance with regulations of law on tax administration.
The aforementioned trading establishments must not have a parent company-subsidiary company relationship with the importer or manufacturer, or have the same parent company as the importer or manufacturer, and must be the first link of the distribution chain that has a sale contract with the importer or manufacturer, or with the parent company or a subsidiary that has the same parent company as the importer or manufacturer of goods subject to SET. The parent company-subsidiary company relationship shall be determined in accordance with the Law on Enterprises.
Example 1: Corporation B owns the trademark B and sells main ingredients to manufacturers of beer B.
Such manufacturers then sell beer B to a single-member limited liability company which is a subsidiary of Corporation B.
The subsidiary of Corporation B sells beer B to joint-stock companies that are its subsidiaries.
Such joint-stock companies sign contracts to sell the beer to their level 1 agents, which do not have any parent company-subsidiary company relationship with Corporation B, its subsidiary, or the joint-stock companies); the level 1 agents sell the beer to level 2 agents, restaurants, and consumers, etc.
The manufacturer shall calculate, declare, and pay SET on the selling prices imposed by the joint-stock companies, provided such prices must not fall below 7% of the average price of the same type of products sold by level 1 agents in the month.
Example 2: Corporation X owns the trademark B. Under a business cooperation contract, Corporation X, which holds the technology, sells ingredients, bottles, and labels to manufacturers for production of beer, which is then sold back to Corporation X.
Corporation X sells the beer to a single-member limited liability company which is a subsidiary of Corporation X.
- The subsidiary signs contracts to sell canned beer, bottled beer to level 1 agents, which do not have any parent company-subsidiary company relationship with Corporation X, its subsidiary); the level 1 agents sell the beer products to level 2 agents, restaurants, and consumers, etc.
The manufacturer shall calculate, declare, and pay SET on the selling prices for canned beer and bottled beer imposed by the subsidiary, provided such prices do not fall below 7% of the average price of the same type of products sold by level 1 agents in the month.
- The subsidiary of Corporation X sells draft beer to joint-stock company X which is another subsidiary of Corporation X), joint-stock company X sign contracts to sell draft beer to independent agents.
The manufacturer shall calculate, declare, and pay SET on the selling prices for draft beer imposed by joint-stock company X, provided such prices do not fall below 7% of the average price of the same type of products sold by such independent agents in the month.
c) With regard to an importer, manufacturer, or assembler that sells cars having fewer than 24 seats to trading establishments:
With regard to imported cars having fewer than 24 seats, the taxable price is the selling price imposed by the importer which must not fall below 105% the cost price of an imported car. Cost price of an imported car = price on which import duty is imposed+ import duty (if any) + SET at importation. If the selling price imposed by the importer is lower than 105% of the cost price of an imported car, the taxable prices shall be imposed by a tax authority in accordance with regulations of law on tax administration.
Example 3: CIF price of an imported car is USD 20,000; import duty on this model is 70%, SET is 45%, Exchange rate at the time of importation is 22,500 VND/USD. The VAT-exclusive selling price on the importer’s invoice is VND 1,164,712,500. Accordingly, SET payable by the importer when selling such cars:
Unit: VND
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No.
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Content
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Tax rate
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Amount
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1
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Taxable price on imported car: 20,000 USD x 22,500 VND
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450,000,000
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2
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Import duty payable: (2) = (1) x tax rate
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70%
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315,000,000
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3
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SET payable at importation (deducted by the importer from SET on cars sold domestically): (3)= [(1)+(2)] x tax rate
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45%
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344,250,000
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4
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Cost price of an imported car: (4) = (1)+(2)+(3)
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1,109,250,000
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5
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VAT-exclusive selling price imposed by importer
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1,164,712,500
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6
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Taxable price of a car sold domestically:
(6) = (5)/1.45
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803,250,000
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7
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SET on a car when it is sold domestically:
(7)=(6) x tax rate
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45%
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361,462,500
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8
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SET payable on a car sold domestically:
(8)= (7) - (3)
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17,212,500
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Example 4: In the same situation as Example 3, but the VAT-exclusive selling price on the importer’s invoice is VND 1,100,000,000. In this case the VAT-exclusive taxable price imposed by the importer is lower than 105% the cost price of an imported car. Thus the tax authority shall impose the selling price in accordance with the Law on Tax administration.
Example 5: In the same situation as Example 3, but the VAT-exclusive selling price on the importer’s invoice is VND 1,186,897,500 (higher than 105% of the cost price of an imported car). Accordingly, SET payable by the importer when selling such cars:
Unit: VND
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No.
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Content
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Tax rate
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Amount
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1
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Cost price of an imported car
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1,109,250,000
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2
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VAT-exclusive selling price imposed by importer
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1,186,897,500
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3
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Taxable price of a car sold domestically:
(3) = (2)/1.45
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818,550,000
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4
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SET on a car when it is sold domestically:
(4)=(3) x tax rate
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45%
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368,347,500
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5
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SET payable on a car sold domestically:
(5)= (4) - 344,250,000 VND
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24,097,500
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The taxable price of a cars having fewer than 24 seats manufactured or assembled in Vietnam is the selling price of the same type of products manufactured which must not fall below 7% of the average price imposed by the trading establishments. The average price imposed by trading establishments for comparison is the selling price of a car without additional features requested by the customer. If the selling price imposed by the manufacturer or assembler is lower than 7% of the average price of the same type products sold by the trading establishment in the month, the taxable price shall be imposed by a tax authority in accordance with regulations of law on tax administration.
2. With regard to imported goods, taxable prices at importation is determined as follows:
Taxable price = Price on which import duty is imposed + import duty
The taxable price is determined in accordance with regulations of law on export and import duties. If imported goods are eligible for exemption or reduction of import duty, the taxable prices shall not include the amount of import duty exempted or reduced.
3. With regard to goods subject to SET, the taxable prices are exclusive of VAT, environmental protection tax (if any), SET, and inclusive of the package value.
With regard to bottled beer, if a deposit for the bottles has been paid, the manufacturer and customers make quarterly statements of the deposit, the deposit on the unrecovered bottles must be included in the revenue subject to SET.
Example 6: The VAT-exclusive price for a liter of boxed beer in 2016 is VND 21,000. SET on beer is 55%. Taxable price is determined as follows:
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Taxable price for a liter of boxed beer
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=
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21,000
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=
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13,548 (VND)
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1 + 55%
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Example 7: In the second quarter of 2016, the VAT-exclusive price for a 24-bottle pack of Ha Noi Beer is VND 124,000. Taxable price is determined as follows:
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Taxable price for a 24-bottle pack
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=
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124,000
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=
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80,000 (VND)
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1 + 55%
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Example 8: In the third quarter of 2016, Company A sells 1,000 bottles of beer to customer B and receive a deposit of VND 1,200 for a bottle. The total deposit is VND 1,200,000. At the end of the quarter, according to the statement of Company A and customer B, 800 empty bottles are recovered, 200 bottles are not recovered. Accordingly, Company A return VND 960,000 to customer B. The deposit on unrecovered bottles is 240,000 (200 x 1,200) and has to be included in the revenue subject to SET.
4. Taxable prices for processed goods are selling prices imposed by the hiring entity or selling prices of products of the same or similar type at the time of selling exclusive of VAT, environmental protection tax (if any), and SET.
If the hiring entity sells processed goods to a trading establishment, taxable prices shall be determined in accordance with instructions in Point b and Point c Clause 1 of this Article.
5. With regard to goods manufactured under a business cooperation contract between the manufacturer and the establishment that uses or owns the trademark (brand name) or manufacturing technology, taxable prices are selling prices exclusive of VAT and environmental protection tax imposed by the establishment that uses or owns the or manufacturing technology. Taxable prices for goods manufactured under a franchise license and sold by branches or representative offices in Vietnam of a foreign company in Vietnam are the selling prices imposed by such branches or representative offices in Vietnam.
If such branches or representative offices in Vietnam sell the goods to another trading establishment, the taxable prices shall be determined in accordance with instructions in Point b and Point c Clause 1 of this Article.
6. Taxable prices of goods sold under a deferred payment plan or instalment plan are selling prices exclusive of VAT, environmental protection tax (if any), and SET of goods sold normally, exclusive of deferred payment interest or instalment interest.
7. Taxable prices for goods/services used for exchange, internal use, gifting, sales promotion are taxable prices of goods/services of the same or similar type at that time.
8. Where an exporter buys goods subject to SET from a manufacturer and sell them domestically instead of exporting, the taxable price is the selling price exclusive of SET, environmental protection tax (if any), and VAT, and is determined as follows:
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Taxable price
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=
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Domestic VAT-exclusive selling price
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-
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Environmental protection tax (if any)
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1 + SET rate
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If the selling price (inclusive of VAT, environmental protection tax, and SET) declared by the exporter as the basis for determination of taxable price is lower than 7% of the selling price on the market, the taxable price shall be imposed by a tax authority in accordance with the Law on Tax administration and its instructional documents.
9. Taxable prices for services are service prices imposed by the service provider, exclusive of VAT and SET:
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Taxable price
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=
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VAT- exclusive service price
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1 + SET rate
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VAT- exclusive services price as the basis for determination of taxable prices for some particular services are specified below:
a) For golf business (including operation of golf training course) is the VAT-exclusive revenue from selling memberships, golf tickets, including training tickets, charges for course maintenance, buggies, caddies, deposits (if any), and other amounts paid by golf players and members. If the deposit is returned, tax refund shall be deducted from tax payable in the next period, or provided in cash. If the golf business also sells other goods/services that are not subject to SET such as hotel, food and beverage, selling goods, games, they are not subject to SET.
Example 9. A golf business provides services related to hotel, food and beverage, selling goods, games that are not subject to SET, they are not subject to SET.
b) For casino, and electronic casino games, taxable prices are the revenue from the casino or electronic casino games, exclusive of the prizes given to players, which equals (=) the amount collected from payers at the counter before playing minus (-) the amount of prizes given to players.
c) For betting business, taxable prices are the revenue from selling betting tickets minus (-) prizes given to players (exclusive of VAT), not including entrance tickets to watch entertainments associated with the betting business.
d) For discotheque, massage, and karaoke business, taxable prices are the VAT-exclusive revenue from services provided within the discotheque, massage, and karaoke business, including revenues from food and drink and associated services e.g. showering, sauna in a massage establishment).
Example 10: VAT-exclusive revenue of a discotheque (including revenue from food and drink) of establishment A in the period is VND 100,000,000.
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Taxable price
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=
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100,000,000
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=
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71,428,571 (VND)
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|
1 + 40%
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dd) For lottery business, taxable prices are the VAT-exclusive revenue from selling lottery tickets in the forms permitted by law.
10. The taxable prices for goods/services specified in Clause 1 through 9 of this Article are inclusive of surcharges (if any) imposed by manufacturers or sellers. Taxable prices of tobacco are inclusive of mandatory contributions and supportive budget specified in the Law on Prevention of harmful effects of tobacco.
Taxable prices are expressed as VND. Where a taxpayer earns revenue or fixes a taxable price in a foreign currency, it must be converted into VND at the applicable exchange rate in accordance with the Law on Tax administration and its instructional documents.
With regard to imported goods, the exchange between VND and a foreign currency must comply with The taxable price is determined in accordance with regulations of law on export and import duties.
11. Where the manufacturer or seller fails to comply with regulations on invoicing, the tax authority shall impose the revenue according to the practical business performance in accordance with the Law on Tax administration, and determine the amount of SET payable.
12. Time for determination of SET:
- For goods: the time of earning revenue is the time of transferring the right to own or use the goods to the buyer, whether the payment is collected or not.
- For services: the time of earning revenue is the time of completion of service provision or issuance of the invoice for service provision buyer, whether the payment is collected or not.
- For imported goods: time of registration of the customs declaration.
13. Manufacturers, importers, sellers of goods and/or services subject to SET must comply with accounting and invoicing practice when buying, selling goods/services and transporting goods as prescribed by law.
Invoices must be used when a manufacturer sells goods or delivers goods to branches, subsidiaries, or agents. Where a branch or store is located in the same province with the manufacturer, or goods are moved from one warehouse to another, the delivery note may be used.
Manufacturers of goods subject to SET using brand names must register them as prescribed.
Article 6. SET rates
1. SET rates are specified in Clause 4 Article 1 of the Law No. 70/2014/QH13 dated November 26, 2014 on amendments to some Articles of the Law on special excise duty and Article 5 of Decree No. 108/2015/ND-CP.
2. Where a manufacturer manufactures various types of goods and/or provide various types of services subject to various SET rates, SET shall be calculated at corresponding rates on each separate type of goods and/or services. If specific SET rates cannot be separately determined, the highest one shall apply.
Chapter III
TAX REFUND, TAX DEDUCTION, TAX REDUCTION
Article 7. Tax refund
Payers of SET (hereinafter referred to as taxpayers) shall receive a tax refund in the following cases:
1. Goods temporarily imported and re-exported, including:
a) SET has been paid imported goods still remain at the border checkpoint under customs control, and then they are re-exported.
b) SET has been paid on imported goods that are delivered or sold to foreign partners via agents in Vietnam; Imported goods for sale to foreign means of transport on international routes through Vietnam’s ports and Vietnamese means of transport on international routes as prescribed by the government.
c) When temporarily imported goods are re-exported, paid SET on the quantity of re-exported goods shall be refunded.
d) When imported goods on which SET has been paid are re-exported, paid SET on the quantity of goods re-exported shall be refunded.
dd) Paid SET on goods imported to attend a fair or exhibition, or for display or serve other purposes for a limited period of time shall be refunded when such goods are re-exported.
e) SET has been paid as declared but the actual quantity of imported goods is smaller than the declared quantity; SET has been paid but goods are damaged or lost during importation because of acceptable reasons.
g) With regard to imported goods the quality or categories of which are not consistent with the contract or import license on account of the foreign seller, if a competent authority has inspected, the foreign seller has certified, and goods may be imported, the customs authority shall inspect and verify the amount of SET payable. Excess tax shall be refunded; tax arrears shall be fully paid.
If goods maybe re-exported (returned) to the foreign seller, paid SET on the quantity of re-exported goods shall be refunded.
If goods are returned to the foreign seller within the period over which import duties are exempt, the customs authority shall inspect the procedures and cancel SET on the quantity of goods returned.
2. If imported goods are materials for manufacturing or processing of goods for export, paid SET on the quantity of materials used for manufacturing or processing of goods that have been actually exported shall be refunded.
Regulations on SET refund specified in Clause 1 and Clause 2 of this Article only apply to goods that have been actually exported; documentation and procedures for refund of SET on imported goods are similar to that for refund of import duties specified in regulations of law on export and import duties.
3. when making a terminal tax statement upon merger, division, separation, dissolution, bankruptcy, ownership transfer, lease of state-owned enterprises that have paid SET excessively, SET refund may be claimed.
4. SET shall be refunded in the following cases:
a) The refund is decided by a competent authority.
b) Tax refund is required under an international agreement to which Vietnam is a signatory.
c) Paid SET is higher than SET payable.
Documentation and procedures for refund of SET in the cases specified in Clause 3 and Clause 4 of this Article are specified in the Law on Tax administration and its instructional documents.
Article 8. Tax deduction
1. A taxpayer that manufactures goods subject to SET from materials subject to SET may deduct the paid SET on the quantity of materials imported or purchased from another domestic manufacturer that is used for manufacturing goods from the SET payable. SET that remains after deduction shall be carried forward to the next period.
For biofuel, the amount of deductible SET in the period depends on the amount of paid SET on a unit of material purchased in the previous period for manufacturing of biofuel.
Example 11: in October, Corporation AB imports 5,000 liters of 92-RON gasoline, pays VND 5,000,000 of SET at importation; buys 3,000 liters of 92-RON gasoline from refinery D and pays VND 3,300,000 of SET. 2,000 liters of E5 are produced after mixing ethanol and mineral spirits.
In November, Corporation AB sells 1,000 liters of E5 to its subsidiaries.
The proportion of 92-RON gasoline in biofuel is 95.06%; ethanol 4.94%.
Deductible SET in November:
(5,000,000 + 3,300,000)/8,000 x 95.06% x 1,000 = 986,247 (VND).
In December, Corporation AB sells E5 that was manufactured in October and November. The amount of deductible SET on biofuel sold in December depends on the amount of paid SET on gasoline imported or purchased in November.
2. Payers of SET on goods subject to SET at import (except for gasoline) may deduct SET paid at importation from SET payable on goods sold domestically. Deductible SET is equal to SET on goods subject to SET that are sold after import, and must not exceed the SET on goods sold domestically. The taxpayer may include SET that remains after deduction because of a force majeure event in expenses when calculating corporate income tax.
Conditions for deducting SET:
- When importing materials subject to SET to manufacture goods subject to SET, and when importing goods subject to SET, the receipt for SET payment at importation is the basis for SET deduction.
- If materials are purchased from a domestic manufacturer:
+ A sale contract which specifies that the materials are directly manufactured by the seller; copies of the Certificate of Business Registration of the seller which bears the seller’s signature and seal.
+ Bank transfer receipts.
+ VAT invoices. The amount of SET paid by the buyer when buying materials equals (=) taxable price multiplied by (x) SET rate, where:
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Taxable price
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=
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VAT-exclusive buying price (according to the VAT invoice)
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-
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Environmental protection tax (if any)
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1 + SET rate
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SET payable is calculated as follows:
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SET payable
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=
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SET on goods subject to SET sold in the period
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-
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Paid SET on the quantity of imported or purchased materials that are used for manufacturing of goods sold in the period
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If SET payable or paid SET on the quantity of materials used for manufacturing of goods sold in the period, the figures of the previous period may be used to calculate deductible SET and the actual amount shall be determined at the end of the quarter or year. In any case, deductible SET must not exceed the SET on the quantity of materials set out in technical regulations applied to such products. The manufacturer must register such technical regulations with the supervisory tax authority.
Example 12: In a tax period, establishment A:
+ Imports 10,000 liters of alcohol and pays VND 250 million of SET at importation (according to the receipt for SET payment at importation).
+ Uses 8,000 liters of alcohol to manufacture 12,000 bottles of alcohol.
+ Sells 9,000 bottles of alcohol; SET on these 9,000 bottles is VND 350 million.
+ SET on the quantity of imported alcohol corresponding to 9,000 bottles that are sold is VND 150 million.
SET payable by establishment A in this period:
350 million – 150 million = 200 million (VND).
Example 13: In a tax period, establishment B:
+ Imports 100 air conditioners of 12,000 BTU and pays VND 100 million of SET at importation (according to the receipt for SET payment at importation).
+ Sells 100 air conditioners domestically; SET on air conditioners sold domestically is VND 120 million.
SET payable by establishment B in this period:
120 million – 100 million = 20 million (VND).
Example 14: In a tax period, establishment B:
+ Imports 100 air conditioners of 12,000 BTU and pays VND 100 million of SET at importation (according to the receipt for SET payment at importation).
+ Sells 100 air conditioners domestically; SET on air conditioners sold domestically is VND 90 million because of a force majeure event.
Establishment B may deduct VND 90 million of SET. Establishment B may include SET that remains after deduction (VND 10 million) in expenses when calculating corporate income tax.
Enterprises permitted to manufacture E5 and/or E10 shall declare and deduct SET at tax authorities in charge of the areas where their headquarters are located. SET on E5 and E10 procedures remains after deduction may be offset against SET payable on other goods/services.
SET payers shall use form No. 01/TTDB (SET declaration) and form No. 01-1/TTDB (Deductible SET on purchased materials and imported goods) enclosed to this Circular.
Article 9. Tax reduction
SET reduction shall comply with Article 9 of the Law on special excise duty No. 27/2008/QH12.
Documentation and procedures for tax reduction shall comply with the Law on Tax administration and its instructional documents.
Chapter IV
IMPLEMENTATION
Article 10. Effect
1. This Circular comes into force from January 01, 2016.
2. This Circular replaces Circular No. 05/2012/TT-BTC dated January 05, 2012 on guidelines for Decree No. 26/2009/ND-CP and Decree No.113/2011/ND-CP.
Article 11. Implementation
1. Tax authorities are responsible for collection, refund, and reduction of SET incurred by business establishments.
2. Customs authorities are responsible for collection, refund, and reduction of SET on imported goods.
3. Difficulties that arise during the implementation should be reported to the Ministry of Finance for consideration./.
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PP MINISTER
DEPUTY MINISTER
Do Hoang Anh Tuan
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Tìm kiếm
Thông tư 195/2015/TT-BTC (Bản Word)
Thông tư 195/2015/TT-BTC (Bản Pdf)
