Smartphones, imported cars, cigars not eligible for VAT reduction

The General Department of Customs has just sent an urgent dispatch to customs departments to guide the implementation of Decree 44/2023/ND-CP regulating the policy of reducing value-added tax (VAT).

The General Department of Customs requests customs departments to disseminate the content of the decree to all customs officials, customs declarants and businesses in the management area.

The General Department of Customs requests customs units to pay attention to some contents related to the VAT reduction policy. Specifically, the VAT reduction of 2% for groups of goods currently subject to a tax rate of 10% (to 8%), except for the following groups of goods: telecommunications, information technology, metals, prefabricated metal products, mining products (excluding coal mining), coke, refined petroleum, chemical products, and goods subject to special consumption tax.

Imported smartphones will not be eligible for VAT reduction.

Items that are not eligible for VAT reduction are specifically stipulated in appendices 1, 2 and 3 issued with Decree 44. According to records, some of the most imported items in this list include: Cars with less than 24 seats, two-wheeled motorbikes, three-wheeled motorbikes with a cylinder capacity of over 125 cm3; computers, smartphones, cigarettes, cigars...

Regarding the list of goods that are not eligible for VAT reduction, the General Department of Customs notes that the list of imports under HS codes in column 10 of Appendix 1, column 10 part a and column 4 part b of Appendix 3 in the Decree is for reference only. Determining HS codes for actually imported goods is still carried out in accordance with the Customs Law and implementing guidelines.

The goods lines with the symbol (*) in column 10 of Appendix 1, column 10 part a and column 4 part b of Appendix 3 in the Decree are declared with HS codes according to the actual imported goods.

The General Department of Customs requests customs departments to guide businesses and customs declarants to declare on the automatic customs clearance system and the National Single Window Mechanism, and to select the correct tax reduction category code (VB205) to declare 8% VAT.

This code does not apply to cases that are not subject to VAT, or subject to VAT but subject to tax rates of 0%, 5% and 10% as prescribed in the Law on Value Added Tax.

The General Department of Customs emphasized that the reduction of VAT from 10% to 8% only applies to customs declarations registered from 0:00 on July 1. Customs declarations registered before this time will not be subject to 8% VAT.

(Source: Tien Phong)

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