Công văn 11243/BTC-CST

To: Provincial-level Tax Departments

In the process of implementation of the law on value-added tax (VAT), the Ministry of Finance has received several proposals from provincial-level Tax Departments on VAT refund for goods exported into non-tariff sub-zones in border-gate economic zones. Regarding this matter, the Ministry of Finance gives its opinion as follows:

1. On VAT refund for goods exported into Lao Bao Special Trade-Economic Zone:

Before January 19, 2009, goods on the list promulgated under Decision No. 1260/QD-UBND of July 1, 2008, of the People’s Committee of Quang Tri province which are brought from mainland Vietnam into Lao Bao Special Trade-Economic Zone for consumption were ineligible for VAT refund.

On January 1, 2009, the Ministry of Finance issued Decision No. 128/QD-BTC which took effect on January 19, 2009, promulgating the list of goods brought from mainland Vietnam into Lao Bao Special Trade-Economic Zone which are subject to inspection prior to VAT refund (a copy of this Decision is enclosed herewith).

On January 22, 2009, the People’s Committee of Quang Tri province issued Decision No. 146/QD-UBND canceling Decision No. 1260/QD-UBND of July 1, 2008, as from January 19, 2009.

Pursuant to the above regulations, from January 19, 2009, goods on the list promulgated together with the Ministry of Finance’s Decision No. 128/QD-BTC of January 19, 2009, are subject to inspection prior to VAT refund. For goods on the list promulgated together with the Ministry of Finance’s Decision No. 128/QD-BTC exported from mainland Vietnam into Lao Bao Special Trade-Economic Zone before the cancellation of Decision No.1260/QD-UBND of the People’s Committee of Quang Tri province, they will be considered for tax refund from January 1, 2009, and their tax refund dossiers will be subject to inspection prior to tax refund.

2. On VAT refund for goods exported into non-tariff sub-zones in other border-gate economic zones:

On July 3, 2009, the Ministry of Finance issued Circular No. 137/2009/TT-BTC guiding the implementation of a number of articles of the Prime Minister’s Decision No. 33/2009/QD-TTg of March 2, 2009, promulgating financial mechanisms and policies applicable to border-gate economic zones. Point 1, Article 1 of Circular No. 137/2009/TT-BTC stipulates: “The List of goods subject to inspection prior to VAT refund applicable to goods and services brought from other functional sub-zones within border-gate economic zones and goods and services brought from mainland Vietnam into non-tariff sub-zones within border-gate economic zones which are eligible for the VAT rate of 0% is provided in Appendix I to this Circular.” Accordingly, from August 17, 2009 (the effective date of Circular No. 137/2009/TT-BTC) goods on the list provided in Appendix I to Circular No. 137/2009/TT-BTC which are exported from mainland Vietnam into non-tariff sub-zones in border-gate economic zones are subject to inspection prior to VAT refund.

The Ministry of Finance notifies its opinion to provincial-level Tax Departments for compliance.