When selling goods to export processing zones, how does the enterprise enjoy tax rates? If the enterprise selling goods into the export processing zone lacks one of the documents for exported goods, what is the VAT rate? Below, Peace Logistics has summarized 3 important things you need to pay special attention to when selling to businesses in export processing zones.
1. VAT on enterprises selling goods into export processing zones.
Pursuant to Circular 219/2013/TT-BTC in Article 9, Clause 1 stipulates the 0% tax rate as follows: “The tax rate of 0%: applied to exported goods and services; construction and installation activities abroad and in non-tariff zones; international transport; goods and services are not subject to VAT upon export, except for cases where the 0% tax rate guided in Clause 3 of this Article is not applied.”
Thus, enterprises selling goods to enterprises in export processing zones are entitled to the tax rate of 0%. However, in order to apply the tax rate of 0%, enterprises selling goods into export processing zones must satisfy certain conditions.
Circular 219/2013/TT-BTC in Article 9, Clause 2 stipulates the conditions for enjoying the 0% tax rate as follows:
1.1. For export goods
- Having a contract to sell or process export goods; export entrustment contract;
- Having documents of payment for goods exported via banks and other documents as prescribed by law;
- Having a customs declaration as prescribed in Clause 2, Article 16 of this Circular.”
In case the enterprise lacks one of the above documents, the tax rate as below shall apply:
- If the enterprise selling goods into the export processing zone lacks a customs declaration, the goods sold into the export processing zone will be charged at the tax rate of 10% and the input value added tax is deductible.
- If the enterprise does not have a bank payment document but still has a customs declaration, the enterprise selling goods into the export processing zone may issue an invoice with the tax rate of 0% but the input VAT is not deductible.
1.2. Sales in export processing zones are not entitled to 0% tax.
However, there are some cases when businesses selling goods into non-export processing zones are NOT entitled to the 0% tax rate, including:
Outbound postal and telecommunications services (including post and telecommunications services provided to organizations and individuals in non-tariff zones;
Providing mobile phone scratch cards with codes and denominations abroad or in non-tariff zones); exported products are exploited natural resources and minerals that have not been processed into other products; goods and services provided to individuals without business registration in the free trade zone, except in other cases as prescribed by the Prime Minister;
Petrol and oil sold for cars by business establishments in non-tariff zones purchased domestically;
Automobiles sold to organizations and individuals in non-tariff zones;
Services provided by business establishments to organizations and individuals in non-tariff zones include: rental of houses, halls, offices, hotels, warehouses; transportation services for workers; catering services (except for industrial catering services, catering services in non-tariff zones);
2. Invoices and vouchers for goods exported into export processing zones.
Pursuant to Circular 119/2014/TT-BTC in Article 5, Clause 1 Amending and supplementing Clause 2, Article 3 of Circular No. 39/2014/TT-BTC as follows:
"2. Invoice types:
a) Value-added invoices (form No. 3.1 of Appendix 3 and Form No. 5.1 of Appendix 5 issued together with this Circular) are invoices for organizations that declare and calculate value-added tax according to the method of VAT declaration and calculation. deductions in the following activities:
- Selling goods and providing services in the country;
- International transportation activities; - Export into the non-tariff zone and the cases are considered as exports; b) Sales invoices are used for the following subjects:
- Organizations and individuals declare and calculate value-added tax by the direct method when selling goods and services in the domestic market, exporting to a non-tariff zone and other cases considered to be exported (Form 3.2, Appendix). Appendix 3 and form No. 5.2, Appendix 5 issued together with this Circular).”
According to the above regulations, when selling goods into an export processing zone or a non-tariff zone, they must issue a value-added invoice or a sales invoice as prescribed.
3. Time to record export revenue.
Circular 119/2014/TT-BTC in Article 3, Clause 7 Amending Clause 4, Article 16 of Circular No. 219/2013/TT-BTC as follows:
"Commercial invoice. The date of determining export revenue for tax calculation is the date of confirmation of completion of customs procedures on the customs declaration.”
According to the above regulations, the time of recording export revenue is the time of completing customs procedures on the customs declaration.
The above are the points you need to keep in mind when exporting to an export processing zone. If you still have any questions, please contact to be answered by our team of experienced professionals.
If you still have difficulty importing/exporting and want to find out more details, please contact Peace or contact phone number: 0911.529.168 (Ms.Lisa)
Or visit the website to update more information: https://dichvulogistics.com.vn/