Circular No. 30/2008/TT-BTC dated April 16, 2008 of the Ministry of Finance amending and supplementing Circular No. 32/2007/TT-BTC dated April 9, 2007 of the Ministry of Finance which guides the implementation of the Government’s Decree No. 158/2003/ND-CP dated December 10, 2003, Decree No. 148/2004/ND-CP dated July 23, 2004, and Decree No. 156/2005/ND-CP dated December 15, 2005, detailing the implementation of the Value-Added Tax Law and the Law amending and supplementing a number of articles of the Value-Added Tax Law
THE MINISTRY OF FINANCE
SOCIALIST REPUBLIC OF VIET NAM
Independence - Freedom - Happiness
Hanoi, April 16, 2008
AMENDING AND SUPPLEMENTING CIRCULAR No. 32/2007/TT-BTC OF APRIL 9, 2007, WHICH GUIDES THE IMPLEMENTATION OF THE GOVERNMENT’S DECREE No. 158/2003/ND-CP OF DECEMBER 10, 2003, DECREE No. 148/2004/ND-CP OF JULY 23, 2004, AND DECREE No. 156/2005/ND-CP OF DECEMBER 15, 2005, DETAILING THE IMPLEMENTATION OF THE VALUE-ADDED TAX LAW AND THE LAW AMENDING AND SUPPLEMENTING A NUMBER OF ARTICLES OF THE VALUE-ADDED TAX LAW
Pursuant to May 10, 1997 Value-Added Tax (VAT) Law No. 02/1997/QH9;
Pursuant to June 17, 2003 Law No. 07/2003/QH11 Amending and Supplementing a Number of Articles of the VAT Law;
Pursuant to the Government’s Decree No. 158/2003/ND-CP of December 10, 2003, detailing the implementation of the VAT Law and the Law Amending and Supplementing a Number of Articles of the VAT Law;
Pursuant to the Government’s Decree No. 148/2004/ND-CP of July 23, 2004, amending and supplementing Clause 1, Article 7 of Decree No. 158/2003/ND-CP of December 10, 2003, detailing the implementation of the VAT Law and the Law Amending and Supplementing a Number of Articles of the VAT Law;
Pursuant to the Government’s Decree No. 156/2005/ND-CP of December 15, 2005, amending and supplementing the Decrees which detail the implementation of the Special Consumption Tax Law and the VAT Law;
Pursuant to the Government’s Decree No. 77/2003/ND-CP of July 1, 2003, defining the functions, tasks, powers and organizational structure of the Ministry of Finance;
The Ministry of Finance guides amendments and supplements to a number of contents of Circular No. 32/2007/TT-BTC of April 9, 2007, as follows:
1. Objects not subject to VAT:
1.1. To amend and supplement Item d, Point 1.4, Section II of Part A as follows:
“d/ Special-use equipment, machinery, spare parts and means of transport and supplies necessary for prospecting, exploring and developing oil and gas fields; spare parts and equipment of aircraft and specific equipment used exclusively for aircraft (of those types which cannot be produced at home). Overseas services of repairing aircraft, including substitute spare parts, equipment and machinery in the course of repair.”
1.2. To amend and supplement Item h, Point 1.23, Section II of Part A as follows:
Non-tariff areas include export-processing zones, export-processing enterprises, bonded warehouses, bonded zones, customs bonded warehouses, special economic-trade zones, trade-industrial zones and other economic zones set up under the Prime Minister’s decisions. Goods trading and exchange relations between these zones and the outside are import and export relations.”
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2. To amend the first paragraph, Point 3, Section I of Part B as follows:
“For products, goods and services used for barter or as donations, gifts or salary payments, their VAT calculation prices are determined as taxable prices of products, goods and services of the same or equivalent types at the time those activities are carried out.”
3. VAT rates:
3.1. To amend and supplement Points 1.1 and 1.2, Section II of Part B as follows:
“1.1. Exported goods include goods exported abroad, including those exported under entrustment, goods sold to export-processing enterprises (except goods used for personal needs), and goods regarded as exports under the Government’s regulations, such as:
1.2. Exported services and services provided to export-processing enterprises for their production and business activities, except services used for personal needs.
Exported services are services provided directly to overseas organizations or individuals and used outside Vietnam if the following conditions are fully met: service providers must have contracts signed with overseas purchasers in accordance with the Commercial Law; overseas purchasers shall pay for services to service providers in Vietnam.
Goods and services used for personal needs within export-processing enterprises are construed as goods and services for which individuals pay by themselves to serve their personal needs.”
3.2. To supplement Point 3.28, Section II of Part B as follows:
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“3.28. Goods and services not specified in Section II, Part A, or Point 1 or 2, Section II, Part B, of this Circular.”
4. To amend and supplement the third em rule, Item d2, Point 1.2, Section III of Part B as follows:
“- Business establishments which supply electricity, water, stationery and goods serving daily activities of export-processing enterprises are not required to carry out customs procedures. Particularly for stationery and goods serving daily activities of export-processing enterprises, the suppliers only need to register with management boards of export-processing zones, industrial parks, hi-tech parks, economic zones or trade zones.”
5. To annul Item h, Point 2.2, Section III of Part B.
6. To amend and supplement Point 5.4, Section IV of Part B as follows:
“5.4. Use of invoices and documents for goods and services used for sales promotion or advertisement; as samples, donations, gifts, or salary payments to laborers; or for internal consumption:
a/ For goods and services used for sales promotion, advertisement or as samples serving the production of and trading in goods and services (products, goods and services used for sales promotion, advertisement or as samples are specified in the Government’s Decree No. 37/2006/ND-CP of April 4, 2006, detailing the Commercial Law regarding trade promotion), VAT invoices must be made, stating goods appellations and quantities and that goods are for sales promotion, advertisement or as free samples, with VAT lines left blank and crossed out.
b/ For goods and services used as donations, gifts; for barter; as salary payments to laborers; or for internal consumption, VAT invoices (or sale invoices) must be made and have all items filled in and VAT is calculated as for sale invoices issued to goods and services to customers.”
7. To amend Point 5.24, Section IV of Part B as follows:
“5.24. Business establishments funded by other business establishments shall, upon the receipt of funds, make receipts and consider the funds as other incomes for the declaration and payment of enterprise income tax according to regulations.
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Funding business establishments shall, based on funding purposes stated in funding contracts, make spending documents.”
8. To amend and supplement the last paragraph, Point 2.7, Section II of Part C as follows:
“Input VAT will be wholly deducted for goods and services used for the formation of enterprises’ fixed assets such as refectories for shift workers, houses for mid-shift breaks, free-of-charge houses, change rooms, vehicle-keeping houses, toilets, water cisterns for laborers working in production/business areas, and houses and health stations for laborers working in industrial parks.”
9. To annul Point 2.19, Section II of Part C.
This Circular takes effect 15 days after its publication in “CONG BAO.”
Problems arising in the course of implementation should be reported to the Ministry of Finance for implementation guidance.
FOR THE MINISTER OF FINANCE
Truong Chi Trung
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