How to refund tax for authorized enterprise for auto part imports?
VCN- If an enterprise registers for participation in the Tax Incentive Program and authorizes another enterprise to import auto parts, the Customs authority which receives the dossier will refund overpaid tax amount to the account of the authorized enterprise upon final settlement in the case where it is eligible for enjoying 0% tax rate in accordance with provisions in Article 7a Decree 125/2017/ND-CP.
This is instructed by the General Department of Vietnam Customs to provincial and municipal Customs Departments for the deployment of the Incentive Tax Program on imported auto parts to facilitate enterprises and these Departments in implementing the program.
Specifically instructing on the application of the tax rate under heading 98.49 for authorized imports, the General Department of Vietnam Customs says that Clause 6 Article 1 Decree 125/2017/ND-CP supplementing Section b, Clause 2 Article 7a stipulates that an enterprise that enjoys the Incentive Tax Program, is an enterprise that is eligible for manufacturing and assembly of automobiles in accordance with the Government’s regulations on requirements for manufacturing, assembly, import of automobiles and trade in automobile warranty and maintenance services, and the conditions for enjoying the Incentive Tax Program.
Auto parts are directly imported by enterprises prescribed in Point a of this Clause for manufacturing and assembly of automobiles, or for auto parts that are imported by organizations and individuals prescribed in Point a of this Clause who authorize another enterprise to import auto parts and meet the following conditions: auto parts listed in heading 98.49, and they cannot be domestically manufactured.
Besides, Clause 6 Article 1 Decree 125/2017/ND-CP supplementing Section b, Clause 3 Article 7 provides that, ‘if an enterprise is eligible for enjoying the Tax Incentive Program, and a taxpayer has paid a tax amount for imported auto parts that is higher than the taxable amount under the tax rate of heading 98.49, the Customs authority shall handle the overpaid tax amounts to enterprises according to the provisions of the Law on Tax Administration and the guidance documents’.
Clause 5 Article 57 of the Law on Tax Administration guiding on tax refund stipulates; ‘Organizations and individuals pay other taxes with the paid tax amount that is higher the taxable amount’.
For these regulations, the General Department of Vietnam Customs said that if an enterprises for participation in the Tax Incentive Program and authorizes another enterprise to import auto parts, the Customs authority which receives the request the 0% tax rate under heading 98.49, will refund any overpaid tax amount to the authorized enterprise’s account upon the final settlement in the case where it is eligible for enjoying the tax rate of 0% in accordance with provisions in Article 7a Decree 125/2017/ND-CP, and the authorized enterprise shall send written requests for refund of overpaid tax amount to be paid into its account (enclosing the request for enjoying 0% tax rate).