On May 25th, 2020, the Government issued Decree 57/2020/ND-CP amending and supplementing a number of articles of Decree No.122/2016/ND-CP dated September 1st, 2016 of the Government on the Export tax, preferential import tariff, list of goods and absolute tax rates, mixed tariffs, and non-quota import tax and Decree No. 125/2017/ND-CP dated November 16th, 2017 amending and supplementing a number of articles of Decree No.122/2016/ND-CP.
Accordingly, the preferential import tax rates for raw materials, supplies and components for production, processing (assembly) of industrial products support development priority for the automobile manufacturing and assembly industry. the period from 2020 to 2024 (hereinafter referred to as the preferential program for automobile industry tax) is prescribed as follows:
– Preferential import tax rate of 0% for domestically unavailable raw materials, supplies and components for production, processing (assembly) of products aided by development priorities for manufacturing industry, automobile assembly (hereinafter referred to as automobile supporting products).
a) At the time of registration of the declaration, the declarant shall declare and calculate tax on imported raw materials, supplies and components at the normal import tax rates or preferential import tax rates. Preferential import tax rates or special preferential import tax rates as prescribed, the tax rate of 0% has not yet been applied.
b) The application of the preferential import tax rate of 0% to raw materials, supplies and components of the automobile industry tax incentives program shall comply with the following principles:
(i) Ensuring the right subjects of application: Enterprises manufacturing, processing (assembling) automobile components and spare parts; Enterprises manufacturing and assembling automobiles produce and assemble automobiles by themselves (assemble).
(ii) Ensure the Applicable Conditions
(iii) Guarantee for the tax incentive review period: The tax incentive review period must not exceed 6 months from January 1 to June 30 or from July 1 to December 31 every year.
(iv) Ensuring sufficient documents and procedures for registering to participate in the Preferential tax program for automobile industry
(v) Implement customs declaration procedures in accordance with the law
(vi) Manufacturing, processing (assembling) establishments of enterprises participating in the automotive tax incentives program must meet the conditions prescribed by law.
(vii) Provide complete documents and carry out procedures to apply the preferential tax rate of 0%