To:

- Provincial/inter-provincial/municipal Customs Departments
- Provincial/municipal Tax departments

The Finance Ministry has recently received reports on problems related to the credit and refund of value-added tax (VAT) which has been overpaid or wrongly paid for imports and exports. Concerning this matters, the Finance Ministry hereby provides the following guidance:

1. Objects eligible for VAT credit or refund

Organizations and individuals importing goods (hereinafter called importers), that have paid at the import stage VAT amounts larger than payable VAT amounts under law (hereinafter called overpaid amounts), or paid at the import stage VAT amounts, which, under the provisions of law, should not have been paid at this stage (hereinafter called wrongly paid amounts), shall enjoy VAT credit or refund under the guidance in this Official Letter.

2. Order and procedures for tax credit and refund

2.1. Where importers are subject to registration of VAT payment by the credit method, their overpaid or wrongly paid VAT amounts at the import stage shall be accounted into input VAT amounts and credited upon the calculation of VAT amounts payable at the domestic trading stage.

Basing themselves on vouchers of VAT payment for imports and exports, taxpayers shall declare by themselves the VAT amounts overpaid or wrongly paid into creditable input VAT amounts.

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2.2. Where importers are not subject to registration of VAT payment by the credit method (organizations and individuals not trading in goods and services liable to VAT or registering VAT payment by the direct method), their overpaid or wrongly paid VAT amounts shall be refunded to them.

Where goods are imported under a consignment, the consignee (goods importer) shall be eligible for refund of overpaid or wrongly paid VAT amount.

2.3. Order and procedures for VAT refund shall be as follows:

a/ Importers shall compile and send their dossiers of request for certification of overpaid or wrongly paid VAT amounts to customs offices where customs declarations are made, each comprising:

- A written request for certification of overpaid or wrongly paid VAT amount.

- The declaration of import goods which have been inspected by the customs office (the original and copies);

- Receipts of VAT on import goods (the originals and copies).

Upon receipt of dossiers, the customs offices shall compare the originals of import declarations and collection receipts of VAT on import goods with their copies, then return the originals to importers.

Within 15 days after receiving the above-said dossiers, the customs offices shall issue written certifications of the VAT amounts overpaid or wrongly paid on import goods.

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a/ After obtaining customs offices' certifications, importers shall compile and send dossiers of request for refund of overpaid or wrongly paid VAT amounts to tax offices of localities where they are headquartered (for organizations) or reside (for individuals). A dossier of request for VAT refund comprises:

- A written request for refund of VAT amounts overpaid or wrongly paid for import goods;

- The customs office's written certification of overpaid or wrongly paid VAT amount;

- The receipt of VAT on import goods (copies).

Tax offices shall have to check the dossiers and issue decisions on refund of overpaid or wrongly paid VAT amounts at the import stage within 15 days after receiving the dossiers.

2.4. State treasuries in the provinces or centrally-run cities shall refund VAT amounts to the above-said objects within three days after receiving tax refund decisions of tax offices.

2.5. Money amounts used to refund overpaid or wrongly paid VAT at the import stage shall come from the VAT refund fund.

2.6. Days of the above-said time limits for overpaid or wrongly paid tax certification and refund shall be working days (excluding weekends and law-prescribed holidays).

3. Organization of implementation

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Any problems arising in the course of implementation should be reported by concerned units to the Finance Ministry for additional guidance.

Truong Chi Trung