Circular No. 92/2010/TT-BTC dated June 17, 2010 of the Ministry of Finance guiding procedures for the payment extension and refund of value-added tax on equipment, machinery, special-use vehicles included in technology lines and on construction supplies which cannot be produced at home and need to be imported to create fixed assets of enterprises

THE MINISTRY OF FINANCE

Circular No. 92/2010/TT-BTC of June 17, 2010, guiding procedures for the payment extension and refund of value-added tax on equipment, machinery, special-use vehicles included in technology lines and on construction supplies which cannot be produced at home and need to be imported to create fixed assets of enterprises

Pursuant to June 3, 2008 Law No. 13/2008/QH12 on Value-Added Tax (VAT);

Pursuant to November 29, 2006 Law No. 78/2006/QH11 on Tax Administration;

Pursuant to the Government’s Decree No. 123/2008/ND-CP of December 8, 2008, detailing and guiding a number of articles of the Law on Value-Added Tax;

Pursuant to the Government’s Decree No. 85/2007/ND-CP of May 25, 2007, detailing a number of articles of the Law on Tax Administration;

Pursuant to the Government’s Decree No. 118/2008/ND-CP of November 27, 2008, defining the functions, tasks, powers and organizational structure of the Ministry of Finance;

In furtherance of the Prime Minister’s directing opinions in the Government Office’s Official Letter No. 2691/VPCP-KTTH of April 26, 2010, on the payment extension and refund of VAT on fixed assets imported for production and business activities, the Ministry of Finance guides the procedures for the extension of the payment time limit and the refund of VAT on equipment, machinery and special-use vehicles included in technology lines and on construction supplies which cannot be produced at home and need to be imported to create fixed assets of enterprises, as follows:

Article 1. Scope of application

1. Business establishments newly set up under investment projects which are in the stage of investment and have not yet been put into operation and operating business establishments which have investment projects (on building of new production lines, expansion of production scope, renewal of technology, improvement of the eco-environment or raising of production capacity), when importing equipment, machinery and special-use vehicles included in technology lines and construction supplies which cannot be produced at home to create their fixed assets, may choose to apply the procedures for extension of VAT payment at the importation stage and VAT refund under the guidance in this Circular if they fully meet the following conditions:

- They have registered for VAT payment by the credit method and have been granted business registration certificates, investment certificates or investment licenses (practice permits); have lawful seals and keep accounting books and documents under the accounting law; and have bank accounts using their tax identification numbers;

- Equipment, machinery and special-use vehicles included in technology lines and construction supplies which cannot be produced at home and need to be imported to create fixed assets are valued at VND 200 billion or more.

- Their investment projects will produce and trade in VAT-Iiable goods and services or both VAT-liable and non-VAT-liable products and services.

2. Goods which cannot be produced at home and need to be imported mentioned in Clause 1 of this Article shall be deter­mined based on the list of equipment, machinery, spare parts and special-use vehicles which can be produced at home and the list of construction supplies which can be produced at home, issued by the Ministry of Planning and Investment.

If production and business establishments import complete technology lines which include both equipment, machinery, special-use vehicles and construction supplies which cannot be produced at home and those which can be produced at home, they may carry out procedures for extension of the tax payment and tax refund under the guidance in this Circular for all equipment, machinery, special-use vehicles and construction supplies included in technology lines.

3. Goods which cannot be produced at home and need to be imported specified in Clauses 1 and 2 of this Article do not include: machinery, equipment, special-use vehicles included in technology lines and construction supplies used to create fixed assets for the manufacture of weapons and ammunitions for defense and security purposes; construction supplies for building working offices and special-use equipment for credit activities of credit institutions, reinsurance, life insurance and securities companies, hospitals and schools; and civil aircraft and yachts not used for passenger and cargo transport or tourism and hotel business.

Article 2. Extension of VAT payment at the importation stage

1. Business establishments defined in Article 1 of this Circular are entitled to a 60-day extension of the time limit for VAT payment at the stage of importation of machinery, equipment, special-use vehicles included in technology lines and construction supplies which cannot be produced at home and need to be imported to create fixed assets, counting from the prescribed tax payment deadline. Tax payment extension will apply after the port arrival of the first import lot valued at under VND 200 billion. Goods shall be cleared from customs procedures immediately after customs offices complete the physical inspection thereof. The tax payment extension and customs clearance do not depend on whether taxes are owed at the importation stage and no guarantee of credit institutions is required.

2. A dossier of request for tax payment extension comprises:

- A written request for VAT payment extension (1 original), (1) clearly stating the reason for extension of the payment of VAT on imported goods being machinery, equipment, special-use vehicles included in technology lines and construction supplies which cannot be used at home and need to be imported to create fixed assets; (2) guaranteeing the accuracy of declarations; and (3) committing and specifying a plan on payment of the tax amount proposed for payment extension.

For cases in which goods are imported in several lots, the dossier for the first goods lot must be enclosed with a list of imports proposed for tax payment extension, made according to form No. 13 provided in Appendix VI to the Finance Ministry’s Circular No. 79/2009/TT-BTC of April 20, 2009, guiding customs procedures; customs inspection and supervision, import duty and export duty and tax administration of imports and exports (submitting 2 originals enclosed with 2 conciliation slips made according to form No. 16 provided in Appendix VI to Circular No. 79/2009/TT-BTC).

For cases in which the tax amount proposed for payment extension belongs to different import customs declarations, these declarations must be listed in the written request for tax payment extension.

- The tax declaration dossier of the tax amount proposed for payment extension (1 copy);

- The contract on the sale and purchase of imports proposed for VAT payment extension; if many contracts are made to this effect, all contracts must be submitted (1 copy for each contract);

- The document approving the investment project or plan which is the investment certificate, for cases in which an investment certificate has been issued by a  competent state agency, or the approval document issued by the business establishment’s board of directors, shareholders’ general meeting or director in accordance with their competence stated in the business establishment’s charter, enclosed with the investment registration document and a receipt issued by the agency receiving the investment project dossier (1 copy for each document), for cases in which no investment certificate is available;

For cases in which equipment, machinery and special-use vehicles included in technology lines and construction supplies which cannot be produced at home and need to be imported to create fixed assets are eligible for both VAT payment extension and import duty exemption under the investment law, the dossiers and procedures for VAT payment extension are the same as those required for import duty exemption specified in Article 102 of Circular No. 79/2009/TT-BTC. For papers which are required to be included in both VAT payment extension dossiers and import duty exemption dossiers, only papers required for an import duty exemption dossier must be submitted.

3. Order of tax payment extension:

3.1. Receiving dossiers:

- For cases in which a tax payment extension dossier is directly submitted to a customs office, customs officers shall receive the dossier, affix a stamp certifying the receipt, write the time of receipt and the number of documents in the dossier.

- For cases in which a tax payment extension dossier is sent by post, customs officers shall affix a stamp showing the date of receiving the dossier and record the receipt in the customs office’s book of incoming and outgoing mails.

- For cases in which a tax payment extension dossier is sent via computer networks, the receipt, inspection and acceptance of the dossier shall be carried out by the customs office via the e-data processing system.

3.2. Processing of dossiers:

For cases in which a tax payment extension dossier filed by a taxpayer is incomplete, within 1 working day after receiving the dossier, the customs office shall notify such in writing to the taxpayer for supplementation of the dossier.

The taxpayer shall supplement the dossier within 3 working days after receiving a written request for dossier supplementation from the customs office. If the taxpayer fails to supplement the dossier as requested by the customs office, he/she will not be entitled to tax payment extension.

If the tax payment extension dossier is complete, accurate and valid as prescribed, the customs office shall issue a written approval of the tax payment extension to the taxpayer within 3 working days after receiving a complete dossier.

Article 3. Procedures for and order of VAT refund

1. A dossier of VAT refund comprises:

a/ A written request for tax refund, made according to form No. 05/DNHT issued together with the Finance Ministry’s Circular No. 128/2008/TT-BTC of December 24, 2008, guiding the collection and management of state budget revenues via state treasury, clearly stating that tax refund is effected under the guidance in this Circular (writing the number of the Circular), and the dossier has no document on payment of VAT at the importation stage.

b/ A general declaration of the VAT amount paid on imported goods for all customs declarations affixed with a certification stamp of the customs office, made according to form No. 01-1/HTBT, enclosed with the Finance Ministry’s Circular No. 60/2007/TT-BTC of June 14, 2007, guiding a number of articles of the Law on Tax Administration and Decree No. 85/2007/ND-CP, in which:

- The “creditable input VAT amount” and “input VAT amount which is higher than the VAT amount proposed to be refunded” items are written with the payable VAT amount:

- The “output VAT amount” item is left blank and crossed out:

- The “paid VAT amount” item is written with “document on payment of VAT at the importation stage is not yet submitted.”

c/ A list of import customs declarations affixed with a certification stamp of the customs office, made according to form No. 01-2/GTGT, enclosed with Circular No. 60/2007/TT-BTC, clearly stating that the list is enclosed with the written request for tax refund made according to form No. 05/DNHT in which:

- The “invoice code” item is replaced with “customs declaration code”;

- The “invoice number” item is replaced with “customs declaration number”;

- The “date of issuance” item is replaced with “date of registration of customs declarations”;

- The “notes” column is written with “document on VAT payment is not yet submitted.”

Business establishments shall take responsi­bility before law for the validity, lawfulness and accuracy of dossiers, vouchers, invoices and other documents related to their requests for VAT refund.

2. Order of VAT refund:

2.1. Submission and receipt of VAT refund dossiers:

Business establishments shall compile and send to tax agencies dossiers of request for VAT refund, excluding documents on payment of VAT at the importation stage.

For cases in which a tax refund dossier is directly submitted to a tax office, tax officers shall receive the dossier, and affix a stamp certifying the receipt, write the time of receipt and the number of documents in the dossier.

For cases in which a tax refund dossier is sent by post, tax officers shall affix a stamp certifying the date of receiving the dossier and record the receipt in the tax office’s book of incoming and outgoing mails.

For cases in which a tax refund dossier is submitted via computer networks, the receipt, the dossier inspection and acceptance shall be carried out by the tax office via the e-data processing system.

2.2. Processing of tax refund:

- For cases in which a tax refund dossier filed by a taxpayer is incomplete,  within 2 working days after receiving the dossier, the tax office shall notify such in writing to the taxpayer for supplementation of the dossier.

- If the tax refund dossier is complete, accurate and valid as prescribed, the tax office shall consider and inspect the dossier according to the procedures for VAT refund.

Within 15 days after receiving a complete dossier, the tax office shall notify the business establishment that the dossier is valid for tax refund (even for dossiers subject to inspection prior to tax refund) and request the business establishment to submit documents on payment of VAT at the importation stage for issuance of a decision on tax refund.

- Within 3 working days after receiving documents on payment of VAT on imported goods, the tax office shall check tax payment documents against the figures declared in the tax refund dossier of the business establishment and issue a tax refund decision. In case the paid VAT amount written in the tax payment document is lower than the tax amount proposed for refund, the to-be-refunded tax amount is that written in tax payment documents. In case the paid VAT amount written in the tax payment document is higher than the tax amount proposed for refund, the to-be-refunded tax amount is the amount proposed for refund.

Article 4. Effect

1. This Circular takes effect on the date of its signing and replaces the Finance Ministry’s Circular No. 205/2009/TT-BTC of October 26, 2009, guiding procedures for refund of value-added tax on equipment, machinery, special-use vehicles, construction supplies, raw materials, supplies and semi-finished products included in technology lines which cannot be produced at home and need to be imported to create fixed assets of enterprises. Cases eligible for tax refund under Circular No. 205/2009/TT-BTC for which tax refund dossiers have been submitted prior to the effective date of this Circular but tax refund has not yet been effected will be eligible for tax refund under this Circular.

For cases in which business establishments defined in Article 1 of this Circular have registered import customs declarations prior to the effective date of this Circular but before the tax payment deadline prescribed in Article 42 of the Law on Tax Administration, they will be entitled to tax payment extension and tax refund under this Circular.

2. Other cases of VAT refund not yet guided in this Circular comply with current laws.

Any problems arising in the process of implementation should be reported to the Ministry of Finance for study and settlement.-

 For the Minister of Finance
Deputy Minister
DO HOANG ANH TUAN