Procedure and application of Import tax exemption for donated goods to government

Pursuant to Clauses 1 Article 8 Decree No. 134/2016 / ND-CP, Gifts exempt from duties following Duty-free allowance .

Duty-free allowance is in accordance with clause 2 of Article 8 Decree No. 134/2016 / ND-CP.

1.Condition of tax exempt

According to Clause 1, Article 8 Decree No. 134/2016 / ND-CP:
1.Gifts exempt from duties specified in Clause 2 Article 16 of the Law on Export  and import duties are those that are not enumerated on the List of goods banned from import, banned from export, suspended from export, suspended from import and not enumerated on the List of goods subject to special excise tax (excluding those serving national defense and security purposes) as prescribed by law

2.Duty-free allowance for import tax:

According to Clause 2 of Article 8 Decree No. 134/2016 / ND-CP

“2. Duty-free allowance:
a) Gifts given by a foreign organization or individual to a Vietnamese organization or individual; gifts given by a Vietnamese organization or individual to a foreign organization or individual whose customs value does not exceed VND 2,000,000 or whose custom value exceeds VND 2,000,000 but duty on which is under VND 200,000 shall be exempt from duties up to 04 times per year.
b) Gifts given by a foreign organization or individual to a Vietnamese organization whose operating cost is covered by state budget as prescribed by state budget laws; gifts given for humanitarian or charitable purposes whose customs value does not exceed VND 30,000,000 shall be exempt from duties up to 04 times per year.
Where duty-free allowance is exceeded by an organization whose operating cost is covered by state budget, duty exemption shall be decided by the Ministry of Finance on a case-by-case basis.
c) Gifts given by a foreign organization or individual to a Vietnamese individual that are drugs or medical equipment for people having fatal diseases specified in Appendix IV hereof whose customs value does not exceed VND 10,000,000 shall be exempt from duties up to 4 times per year.”

3.Application

According to Clause 3 of Article 8 Decree No. 134/2016 / ND-CP:

“3.Application for duty exemption:
a) A customs dossier defined by customs law;
b) A donation agreement if the gift recipient is an organization: 01 certified true copy bearing the seal of such organization.
The recipient who is a natural person shall declare the gifts and information about the overseas giver on the customs declaration, and take responsibility for the truthfulness and adequacy of such information;
c) 01 original copy of the decision on exemption of duties issued by the Minister of Finance if the gifts exceed the duty-free allowance;
d) 01 original copy of the written permission issued by the superior authority for receipt and use of the duty-free goods or a document proving that the organization’s operating cost is covered by state budget (if the recipient is an organization whose operating cost is covered by state budget);
dd) 01 original copy of the document issued by the President of the People’s Committee of the province if the gift is given for humanitarian or charitable purposes
.”

4.Procedures for granting duty exemption

According to Clause 3 of Article 31 Decree No. 134/2016 / ND-CP

“3. Procedures for granting duty exemption:

a) The taxpayer shall determine and declare the amount of duty-free goods and tax exempted (except duties on goods imported or exported for processing by the hirer) while following customs procedures and take responsibility for such declaration.
b) The customs authority where customs procedures are followed shall examine the declaration and applicable regulations to decide the grant of duty exemption.
If imported goods are not eligible for duty exemption as declared, the taxpayer shall have to pay duties and fines (if any).
c) Electronic data processing system shall deduct the quantity of imports or exports written on the duty-free list.
In case of submission of a physical duty-free list, the customs authority shall update and deduct the quantity of goods exported and imported accordingly.
In case of duty-free import of an entire assembly or production line which has to be divided into more than one shipment, within 15 days from the import of the last shipment of each assembly or line, the importer shall submit a consolidated import declaration to the customs authority in accordance with tax administration laws.”

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