|Ph.D Nguyen Thi Kim Oanh, Deputy Head of the Department of Customs Operations, Faculty of Tax and Customs, Academy of Finance spoke to Customs News about the issue.|
Currently, the Ministry of Finance is consulting on the draft Decree on Export Tariff, Preferential Import Tariff under the List of commodities and their flat tax, compound tariff, and out-of-quota import tariff. How do you assess the role and significance of this Tariff?
Clause 1, Article 11 of the Law on Import and Export Duties provides that the Government issues the Export Tariff, Preferential Import Tariff under the List of commodities and their flat tax, compound tariff, and out-of-quota import tariff. The Export Tariff, Preferential Import Tariff includes specific contents such as a detailed list of goods under the 8-digit HS code, a description of goods, tax rates and conditions for enjoying preferential tax rates.
The provisions in the Decree instruct importers and exporters to better understand the requirements for the goods eligible for the application of export tax, preferential import tax, and procedures implemented by the taxpayer to enjoy the preferential tax rate, thereby helping businesses better know the roadmap for tariff reduction under Free Trade Agreements (FTAs) and international commitments signed by Vietnam.
This shows compliance with Vietnam’s international commitments, especially when the country joins the World Trade Organization (WTO) or FTAs.
The detailed regulations on export and import tax rates for each export and import item under the 8-digit HS code and goods description will bring many advantages for businesses and customs authorities in carrying out customs procedures for the items specified in the draft Decree.
This contributes to increasing the value of import-export turnover in the future for items on the list of goods subject to export tax and preferential import tax, thereby helping enterprises develop.
On the other hand, when businesses trade goods eligible for export and import tax incentives, the promulgation of the preferential tariff will help them accurately calculate the cost and tax for each import and export item, and understand requirements for enjoying the preferential tax rate, thereby helping businesses build a financial plan, cash flow plan, specific and accurate business strategy and minimize risk.
For goods subject to preferential export tax, the provisions in the draft Decree will encourage production and increase foreign currency revenue for export goods of high added value, creating many tax benefits for Vietnamese exports; limiting the export of unprocessed natural resources, reducing the export of processed goods of low added value.
For state management, the promulgation of the revised Decree aims to meet the roadmap under FTAs and international commitments signed by Vietnam. This makes information transparent and provides information to businesses.
I believe the codification of national legal documents to be consistent with international commitments is inevitable. When the legal documents related to the Export Tariff and Preferential Import Tax are amended appropriately and closely followed the implementation roadmap of the signed FTAs, it will create many benefits for businesses. Because, under the current trend of trade liberalization, tariff lines are increasingly reduced. If the promulgation of legal documents is later than the tariff reduction roadmap, it will cause disadvantages for enterprises because they do not enjoy the reduced tax rate.
In your opinion, are regulations in the draft decree reasonable?
The amendment to the tariff in a timely fashion and meeting the requirements of the tariff reduction roadmap in FTAs is reasonable. Because, Decree No. 122/2016/ND-CP on Export Tariff, Preferential Import Tariff, List of goods and its flat tax, compound tariff, and out-of-quota import tariff has been revised four times. Many regulations have been amended and supplemented significantly compared to the original Decree.
In order to facilitate enterprises in the classification and application of goods codes, it is necessary to issue a new Decree to replace the five relevant Decrees issued from 2016, thereby, ensuring transparency, creating favorable conditions for businesses, and reducing administrative costs for customs authorities and taxpayers.
In addition, some content in these Decrees should also be reviewed to ensure clarity.
What are your expectations about the draft Decree when it is officially issued?
I hope that after the Decree is issued, all the information in the decree will be widely publicized. And most importantly, it is necessary to have an attached software tool so that it can be easily looked up instead of depending on paper documents.
The easy and accurate information search will help businesses limit many risks in implementation, comply with the regulations on tax incentives and quickly benefit from export tax and preferential import tax; facilitate Customs authorities in customs inspection for imported and exported goods governed by this Decree.
Thank you, Madam!