In the trend of world economic integration, it is very common to temporarily import goods into Vietnam and then re-export to another country. With Circular No. 219/2013/TT-BTC of the Ministry of Finance, Vietnam has taken specific measures to manage tax payment in these cases.
Commercial Law explains temporary import for re-export of goods means that goods brought from abroad or from special areas located in the territory of Vietnam are considered as separate customs areas according to the legal provisions , carrying out import procedures into Vietnam and procedures for exporting such goods out of Vietnam. Meanwhile, temporary export and re-import of goods means that goods are brought abroad or into special areas (which are considered as separate customs areas according to the legal provisions) located within f Vietnam, , carrying out procedures for exporting out of Vietnam and re-importing the same goods into Vietnam.
For value-added tax (VAT)
According to Clause 20 Article 4 of Circular No. 219/2013/TT-BTC of the Ministry of Finance, there are specific regulations on subjects not subject to VAT as follows: “Goods transshipped or transited through the Vietnamese territory; goods temporarily imported for re-export; goods temporarily exported or re-import; raw materials and supplies imported for manufacture or processing of goods for export under the export processing or manufacturing contract signed with a foreign party.”
According to the above guidance, goods temporarily imported for re-export for non-consumption in Vietnam are not subject to VAT. Dossiers and procedures to determine and settle the non-collection of VAT in this case shall comply with the guidance of the Ministry of Finance on customs procedures; customs inspection and supervision; export tax, import tax and tax administration for imported and exported goods.
For import tax
Pursuant to Clause 9 of Article 16 of the Law on Import and Export Taxes (2016), goods temporarily imported for re-export or temporarily exported for re-import within a certain period are exempt from import tax or export tax, specifically:
- Goods temporarily imported or exported to participate in fairs, exhibitions, product introduction, sports or art events, or other events; machinery and equipment temporarily imported for re-export for testing, research and development; machinery and equipment, tools temporarily imported or exported to be used for a certain period of time or serve overseas processing, except for machinery, equipment, tools, vehicles permitted to be temporarily imported to serve investment projects, construction, installation, or manufacture.
- Machinery, equipment, components, and spare parts temporarily imported for replacement or repair of foreign ships or airplanes, or temporarily exported for replacement or repair of Vietnamese ships or airplanes overseas; goods temporarily imported to supply for foreign ships or airplanes in Vietnam’s ports.
- Goods temporarily imported or exported for warranty, repair, or replacement.
- Vehicles temporarily imported or exported to carry exports or imports.
- Goods temporarily imported for re-export within the temporary import for the re-export period (including the extension period) are guaranteed by a credit institution or have been deposited equivalent to the import tax amount of goods temporarily imported for re-export.
Thus, for imported goods (not on the list of goods banned from import) imported in the form of temporary import for re-export according to the above provisions, they are exempt from import tax and are not subject to VAT.