Quyết định 194/2003/QD-BTC

DECISION

PROMULGATING THE REGULATION ON TAX AND CUSTOMS MANAGEMENT REGIMES FOR THE EXPERIMENTAL EXPANSION OF FUNCTIONS OF ENTERPRISES IN TAN THUAN EXPORT-PROCESSING ZONE

THE MINISTER OF FINANCE

Pursuant to the Government's Decree No. 86/2002/ND-CP dated November 5, 2002 prescribing the functions, tasks, powers and organizational structures of the ministries and ministerial-level agencies;
Pursuant to the Prime Minister's Official Dispatch No. 1395/CP-CN dated November 8, 2002 and Official Dispatch No. 891/CP-CN dated July 4, 2003 on the experimental expansion of the operational functions of Tan Thuan export-processing zone;
Pursuant to the Ministry of Planning and Investment's Official Dispatch No. 7322/BKH/KCN dated November 18, 2002 and Official Dispatch No. 4206/BKH/KCN&KCX dated July 11, 2003;
At the proposal of the General Director of Customs,

DECIDES:

Article 1. To promulgate together with this Decision the Regulation on tax and customs management regimes for the experimental expansion of functions of enterprises in Tan Thuan export-processing zone.

Article 2. This Decision takes effect 15 days after its publication in the Official Gazette.

Article 3. The General Director of Customs, the heads of units under the Ministry of Finance and concerned organizations and individuals shall have to implement this Decision.

REGULATION

ON TAX AND CUSTOMS MANAGEMENT REGIMES FOR THE EXPERIMENTAL EXPANSION OF FUNCTIONS OF ENTERPRISES IN TAN THUAN EXPORT-PROCESSING ZONE
(Issued together with the Minister of Finance's Decision No. 194/2003/QD-BTC dated November 28, 2003)

I. GENERAL PROVISIONS

1. This Regulation guides the customs procedures, customs inspection and supervision regimes and tax management for activities of goods import, export and exchange by export-processing enterprises in Tan Thuan export-processing zone, which are allowed to expand their operational functions under the Ministry of Planning and Investment's Official Dispatch No. 7322/BKH/KCN dated November 18, 2002 and Official Dispatch No. 4206/BKH/KCN&KCX dated July 11, 2003.

For other activities of export-processing enterprises, which are not included in the experimental expansion of their functions, the applicable customs procedures and tax policies shall comply with the current regulations in the Government's Decree No. 36/CP dated April 24, 1997 and relevant guiding documents.

2. Enterprises in Tan Thuan export-processing zone must make separate accounting for experimental business and service activities and have separate warehouses and yards for storing these goods.

II. DETAILED GUIDANCE

1. For the services of providing goods and raw materials to enterprises in Tan Thuan export-processing zone and inland areas from domestic and/or foreign sources:

For these activities, enterprises must set up their own bonded warehouses or sign contracts on hiring bonded warehouses in Tan Thuan export-processing zone. The setting up or hire of bonded warehouses; goods put in, taken out of, stored and preserved in bonded warehouses, as well as other related matters shall comply with the Government's Decree No. 101/2001/ND-CP dated December 31, 2001.

2. For the services of purchasing, preserving, processing, re-processing and packing home-made products for sale into foreign countries and purchasing, preserving, processing, re-processing and packing foreign products for sale into inland areas.

2.1. Regarding the services of purchasing, preserving and packing home-made products for sale into foreign countries and purchasing, preserving and packing foreign products for sale into inland areas:

- Enterprises may provide these services by mode of goods consignment at bonded warehouses or;

- They may directly carry out the import and export procedures at the customs office of Tan Thuan export-processing zone if goods are to be immediately exported to foreign countries or import goods are to be immediately brought out for consumption in inland areas. Export-processing enterprises shall have to strictly abide by the current import and export policies.

For the services of purchasing, preserving and packing home-made products for sale into foreign countries, export-processing enterprises shall have to declare and pay export tax and be refunded with the value added tax on export goods.

For the services of purchasing, preserving and packing of foreign products for sale into the inland areas, export-processing enterprises shall have to declare and pay import tax, value added tax and special consumption tax (if any) as prescribed for import goods.

2.2. Regarding the activities of re-processing home-made products for sale into foreign countries and foreign products for sale into inland areas:

a) For the activities of re-processing home-made products for sale into foreign countries:

- When export-processing enterprises purchase products from inland areas into Tan Thuan export-processing zone for re-processing, the customs office of Tan Thuan export-processing zone shall carry out the export procedures for Vietnamese enterprises and organizations (hereinafter called Vietnamese enterprises for short) according to the regulations on export goods. Vietnamese enterprises shall be refunded with the value added tax on export goods.

- When exporting products to foreign countries, export-processing enterprises shall carry out the export procedures at the Customs Sub-Department of Tan Thuan export-processing zone; in the export declarations, they must clearly state that the export goods are purchased for re-processing under declarations No, datedThe Customs Sub-Department of Tan Thuan export-processing zone shall carry out the export procedures according to current regulations on export goods of export-processing enterprises.

b) For the activities of re-processing foreign products for sale into inland areas

- When importing products from foreign countries into the export-processing zone for re-processing, export-processing enterprises shall register to carry out the customs procedures at the customs office of Tan Thuan export-processing zone; the customs declarations must clearly state that goods are imported for re-processing for domestic consumption.

- When consuming goods in inland areas, Vietnamese enterprises purchasing goods shall have to carry out the import procedures at the customs office of Tan Thuan export-processing zone and pay import tax, value added tax and special consumption tax (if any) according to current regulations on import goods.

2.3. For the activities of processing home-made products for sale into foreign countries and foreign products for sale into inland areas:

As the processed goods belong to the ownership of processee-enterprises but not to the ownership of processor-enterprises (export-processing enterprises), the processing undertaking and ordering shall comply with current regulations on processed goods; the sale of goods processed at Tan Thuan export-processing zone on foreign traders' orders into inland areas shall comply with the regulations on the on-the-spot import and export of processed goods as provided for in the Government's Decree No. 44/2001/ND-CP dated August 2, 2001 amending and supplementing Decree No. 57/1998/ND-CP dated July 31, 1998 and Circular No. 07/2000/TT-TCHQ dated November 2, 2000 of the General Department of Customs; the sale of goods processed at Tan Thuan export-processing zone on Vietnamese enterprises' orders into foreign countries shall comply with current regulations on export goods.

3. Services of purchasing goods from foreign countries for sale in the third country:

- For these services, enterprises shall open registration declarations in the form of temporary import for re-export. The procedures for temporary import and re-export shall be carried out at the Customs Sub-Department of Tan Thuan export-processing zone. The transportation of temporarily imported goods from border-gates to Tan Thuan export-processing zone and the transportation of re-exported goods from Tan Thuan export-processing zone to border-gates shall comply with the regulations on goods transported from border-gate to border-gate.

In cases where these products are re-exported together with other products being other than temporarily-imported products, enterprises shall have to register separate declarations for such products in strict accordance with their categories.

4. On the calculation of import tax on the value of raw materials and supplies imported for processing for sale into inland areas:

- The registration of processing contracts and the customs procedures shall comply with current regulations on export-processing enterprises undertaking the processing for sale into inland areas.

- When importing processed products into the inland areas, Vietnamese enterprises ordering the processing shall have to pay import tax, value added tax and special consumption tax (if any). The payable import tax amount shall be calculated only on the volumes of raw materials and supplies imported from foreign countries which constitute the processed goods, the value added tax shall be calculated on the total amount of the processing costs plus import tax amount and special consumption tax amount (if any). Bases for determining the payable import tax amount on the volumes of raw materials and supplies imported from foreign countries which constitute the processed products include:

+ The value of each kind of import raw materials and supplies in a product unit (shall be calculated as being equal to the import prices (CIF) from foreign countries or the prices of raw materials and supplies of the same kinds on the domestic market (in VND) multiplied with the consumption norms of each kind of import raw materials and supplies in each goods unit, which are elaborated by export-processing enterprises themselves. The directors of export-processing enterprises shall bear responsibility before law for the truthfulness of these norms.

+ The quantity of products to be imported back into Vietnam's inland areas.

+ The import tax rates for each kind of raw materials and supplies.

5. The activities of experimentally expanding the functions of enterprises in Tan Thuan export-processing zone shall be exempt from enterprise income tax for one year after taxable incomes are generated; after the period of enterprise income tax exemption, these activities shall be subject to enterprise income tax rate of 28%.

III. IMPLEMENTATION ORGANIZATION

1. The Customs Departments and Tax Departments of provinces and centrally-run cities, concerned enterprises and units shall have to implement this Regulation.

2. Quarterly, enterprises undertaking the experimental expansion of functions shall send to the Customs Sub-Department of Tan Thuan export-processing zone and the Tax Department of Ho Chi Minh City reports on matters related to the expansion of functions prescribed in this Regulation, regarding the quantities of imported, exported and domestically consumed goods, as well as goods left in stock.

In cases where enterprises show sign of untruthfulness in their reports or commit fraudulence to evade tax, the customs office of Tan Thuan export-processing zone and the Tax Department of Ho Chi Minh city may inspect the expansion of functions of enterprises in Tan Thuan export-processing zone.

3. In the course of implementing this Regulation, concerned units and organizations should promptly detect and report problems and loopholes to the Ministry of Finance for timely direction.