Circular No. 152/2011/TT-BTC guiding the implementation of Decree No. 67/2011/NĐ-CP dated August 8, 2011 of the Government detailing and guiding the implementation of certain provisions of the Law on Environmental Protection Tax.

CIRCULAR

||| Guidelines for implementing Decree No. 67/2011/NĐ-CP dated August 8, 2011 of the Government detailing and guiding the implementation of certain provisions of the Law on Environmental Protection Tax

Pursuant to the Law on Environmental Protection Tax No. 57/2010/QH12 dated November 15, 2010;

Pursuant to the Law on Tax Administration No. 78/2006/QH11 dated November 29, 2006 and Government Decrees detailing the implementation of the Law on Tax Administration;

Pursuant to Resolution No. 1269/2011/NQ-UBTVQH12 dated July 14, 2011 of the Standing Committee of the National Assembly regarding the environmental protection tax schedule;

Pursuant to Decree No. 67/2011/NĐ-CP dated August 8, 2011 of the Government detailing and guiding the implementation of certain provisions of the Law on Environmental Protection Tax;

Pursuant to Government Decree No. 118/2008/NĐ-CP dated November 27, 2008 stipulating the functions, powers, tasks, and organizational structure of the Ministry of Finance;

The Ministry of Finance hereby provides guidance as follows:

PART I
SCOPE OF APPLICATION

Article 1. Taxable objects

The taxable objects specified in Article 3 of the Law on Environmental Protection Tax and Article 2 of Decree No. 67/2011/NĐ-CP dated August 8, 2011 of the Government are specifically guided as follows:

1. Gasoline, diesel fuel, lubricating oil, including:

1.1. Gasoline, except ethanol;

1.2. Jet fuel;

1.3. Diesel fuel;

1.4. Kerosene;

1.5. Fuel oil;

1.6. Lubricating oil;

1.7. Grease.

Gasoline, diesel fuel, and lubricating oil as stipulated in this clause refer to various types of gasoline, diesel fuel, and lubricating oil (hereinafter collectively referred to as petroleum products) derived from fossil sources sold in Vietnam, excluding bio-products (such as ethanol, vegetable oils, animal fats...).

For blended fuels containing both biofuels and fossil-based petroleum products, only the portion of fossil-based petroleum products shall be subject to environmental protection tax.

2. Coal, including:

2.1. Brown coal;

2.2. Anthracite;

2.3. Bituminous coal;

2.4. Other types of coal.

3. Hydrochlorofluorocarbon (HCFC) solution is a group of ozone-depleting substances used as refrigerants in cooling equipment and semiconductor industry, produced domestically, imported separately, or contained in imported refrigeration equipment.

5. Herbicides classified as restricted use.

6. Termite control agents classified as restricted use.

7. Wood preservatives classified as restricted use.

8. Warehouse disinfectants classified as restricted use.

Detailed lists of herbicides, termite control agents, wood preservatives, and warehouse disinfectants classified as restricted use are determined according to Resolution No. 1269/2011/NQ-UBTVQH12 dated July 14, 2011 of the Standing Committee of the National Assembly regarding the environmental protection tax schedule.

Article 2. Non-taxable objects

1. Goods not specified in Article 3 of the Law on Environmental Protection Tax and detailed in Article 2 of Decree No. 67/2011/NĐ-CP, Article 1 of this Circular are non-taxable objects under the environmental protection tax.

2.1. Goods transported from the exporting country to the importing country through Vietnamese customs (transiting or transferring at border gates, including those stored in bonded warehouses) without being declared for import into Vietnam or export out of Vietnam.

2.2. Goods transiting through Vietnamese customs and borders based on agreements signed between the Government of Vietnam and foreign governments or authorized agencies or individuals by the two governments according to the law.

2.3. Goods temporarily imported for re-export within the time limit prescribed by law.

2.4. Goods exported abroad directly by production units (including processing units) or entrusted to trading units for export, except when organizations, households, or individuals purchase goods subject to environmental protection tax for export.

Based on the customs declaration of goods, the customs authority handling the customs procedures will determine whether the goods fall under the category of non-taxable objects under the environmental protection tax as stipulated in this clause.

Article 3. Taxpayers

1. The taxpayer of the environmental protection tax is an organization, household, or individual producing or importing goods subject to tax as specified in Article 1 of this Circular.

2. In specific cases, the taxpayer of the environmental protection tax is defined as follows:

2.1. The entity receiving the entrustment to import goods is the taxpayer of the environmental protection tax, regardless of the form of entrustment to import and whether it delivers the goods to the entrusting party or receives the entrustment to import.

2.2. Organizations, households, and individuals producing, accepting processing while also accepting entrustment to sell goods into the domestic market are taxpayers of the environmental protection tax. If organizations, households, or individuals accept processing but do not accept entrustment to sell, then the organization, household, or individual entrusting the processing is the taxpayer of the environmental protection tax when selling goods in Vietnam.

2.3. In cases where organizations, households, or individuals act as intermediaries in collecting small-scale coal mining without presenting proof that the goods have been taxed, the intermediary organization, household, or individual is the taxpayer.

Chapter II
BASIS AND METHOD OF CALCULATING TAX

Article 4. Method of Calculating Tax

The environmental protection tax payable shall be calculated according to the following formula:

Article 5. Tax Base

The basis for calculating the environmental protection tax is the quantity of taxable goods and the absolute tax rate

1.1. For domestically produced goods, the quantity of taxable goods is the quantity of goods produced and sold, exchanged, consumed internally, given as gifts, promotional items, or advertisements.

1.2. For imported goods, the quantity of taxable goods is the quantity of imported goods.

In cases where the quantity of goods subject to environmental protection tax is exported, sold, or imported using units of measurement different from those specified in the Environmental Protection Tax Rate Table issued by the Standing Committee of the National Assembly, such quantities must be converted to the units of measurement specified in the Environmental Protection Tax Rate Table for tax calculation purposes.

1.3. For mixed fuels containing gasoline, diesel, lubricating oils derived from fossil sources, and biofuels, the quantity of taxable goods during the period is the quantity of gasoline, diesel, and lubricating oils derived from fossil sources contained within the imported or produced and sold, exchanged, gifted, or internally consumed mixed fuels, which must be converted to the units of measurement specified for tax calculation of the corresponding goods. The method of determination is as follows:

Based on technical standards for processing mixed fuels approved by competent authorities (including cases where the percentage (%) of gasoline, diesel, and lubricating oils derived from fossil sources in mixed fuels changes), taxpayers shall calculate, declare, and pay the environmental protection tax on the quantity of gasoline, diesel, and lubricating oils derived from fossil sources; simultaneously, they have the responsibility to notify the tax authority about the percentage (%) of gasoline, diesel, and lubricating oils derived from fossil sources contained in mixed fuels and submit this information along with the tax declaration form for the following month starting from when the sale (or change in ratio) of mixed fuels begins.

Chapter III
DECLARATION, PAYMENT, AND REFUND OF TAX

Article 6. Time of Tax Calculation

1. For domestically produced goods sold, exchanged, gifted, promoted, or advertised, the time of tax calculation is the time of transfer of ownership or right to use the goods.

2. For domestically produced goods intended for internal consumption, the time of tax calculation is the time of use of the goods.

3. For imported goods, the time of tax calculation is the time of customs declaration, except for imported gasoline and diesel for sale as stipulated in Clause 4 of this Article.

4. For gasoline and diesel produced or imported for sale, the time of tax calculation is the time when the oil trading company sells the goods.

Article 7. Declaration and Payment of Tax

1. Declaration and payment of tax shall be carried out in accordance with the Law on Environmental Protection Tax, the Law on Tax Administration, and specific guiding documents for the implementation of the Law on Tax Administration as follows:

1.1. The tax declaration form for environmental protection tax is Form No. 01/TBVMT issued together with this Circular and related documents concerning tax declaration and calculation.

For exported, imported, transited, or temporarily imported-reexported goods, the customs declaration documents for the goods shall be used as the tax declaration form for environmental protection tax.

Organizations and individuals engaged in production and business of taxable goods shall bear full responsibility for declaring environmental protection tax. If false declarations, fraud, or tax evasion are discovered, they shall be dealt with according to the laws on tax administration.

1.2. Place of submission of tax declaration forms:

a) For domestically produced goods (except for domestic coal consumption of the Vietnam Coal-Mineral Industries Group and oil trading businesses), taxpayers shall submit the environmental protection tax declaration form to the directly managing tax authority.

In cases where taxpayers have production bases for taxable goods in provinces or centrally-administered cities other than their main office, they shall submit the environmental protection tax declaration form to the directly managing tax authority at the location of the production base.

b) For imported goods (excluding imported gasoline and diesel for sale), taxpayers shall submit the tax declaration form to the customs authority handling the customs procedures.

1.3. Declaration of environmental protection tax:

a) For domestically produced goods sold, exchanged, consumed internally, gifted, promoted, or advertised, taxpayers shall declare, calculate, and pay taxes monthly in accordance with the Law on Tax Administration and its implementing regulations.

In cases where no environmental protection tax is payable in a month, taxpayers shall still declare and submit the tax declaration form to the tax management authority for record-keeping.

b) For imported goods and entrusted imported goods subject to environmental protection tax, taxpayers shall declare, calculate, and pay taxes on a case-by-case basis (excluding imported gasoline and diesel for sale).

The declaration and payment of environmental protection tax for imported goods shall be carried out concurrently with the declaration and payment of import duties, except for imported gasoline and diesel, which shall be handled in accordance with Clause 2 of Article 7 of this Circular.

The deadline for paying environmental protection tax in this case is the deadline for paying import duties as stipulated in the Law on Tax Administration and its implementing regulations.

2.1. Organizations and individuals producing, trading in plastic bags, and importing refrigeration equipment containing HCFCs shall declare and pay environmental protection tax based on product quality standards and related documentation.

2.2. For gasoline and diesel:

Petroleum trading companies at the wholesale level shall register, declare, and pay environmental protection tax to the state budget at the local tax authority where they declare and pay value-added tax, specifically:

- Petroleum trading companies at the wholesale level that directly import, produce, or process petroleum products (referred to collectively as wholesale units) shall declare and pay taxes at the locality where the main office of these wholesale units is located for the volume of petroleum products directly exported, sold, including internal consumption exports, product exchange exports, export returns of entrusted imports, sales to organizations and individuals outside the wholesale unit's system (including enterprises in which the wholesale unit holds less than 50% shares), except for the volume of petroleum products exported and sold, and entrusted imports to other petroleum trading companies at the wholesale level.

- Independent accounting subsidiaries directly under wholesale units; branches directly under wholesale units; joint-stock companies controlled by wholesale units (holding more than 50% of shares) or branches directly under subsidiaries, branches directly under the aforementioned joint-stock companies (collectively referred to as subsidiary units) shall declare and pay taxes at the locality where the main office of the subsidiary units is located for the volume of petroleum products exported and sold by subsidiary units to organizations and individuals outside the system.

- Organizations that directly import, produce, or process petroleum products shall declare and pay taxes at the local tax authority where they declare and pay value-added tax when exporting and selling petroleum products.

- For cases where petroleum is used as raw material for blending biofuel and has not yet been declared and paid environmental protection tax, when selling biofuel, the seller of biofuel must declare and pay environmental protection tax according to regulations.

2.3. Regarding coal mining and domestic consumption:

2.3.1. For coal managed and allocated by Vietnam National Coal-Mineral Industries Group (Vinacomin) to subsidiaries for mining, processing, and consumption, the declaration and payment of environmental protection tax shall be carried out as follows:

a) Monthly, Vinacomin's wholesale companies responsible for coal consumption shall allocate the amount of environmental protection tax payable to localities with corresponding coal mining based on the quantity of coal purchased from production and mining companies in the locality and prepare the Environmental Protection Tax Calculation Form according to Model Appendix No. 02/TBVMT issued along with this Circular.

The amount of environmental protection tax allocated to localities with coal mining is determined based on the percentage of domestic coal consumption in the total amount of coal sold and the quantity of coal mined locally sold to Vinacomin's wholesale coal consumption companies, calculated using the following formula:

b) The wholesale coal consumption company shall declare and pay the entire environmental protection tax generated from coal mining and domestic consumption according to Declaration Form No. 01/TBVMT and Appendix No. 02/TBVMT issued along with this Circular to the direct managing tax authority of the wholesale company, while sending a copy of Appendix No. 02/TBVMT to the tax authority managing the mining company.

c) Based on the amount of environmental protection tax declared and paid to each locality on Appendix No. 02/TBVMT during the tax calculation period, the wholesale coal consumption company shall issue tax payment vouchers for the locality where its main office is located (if there is a tax payable) and localities with coal mining.

On the tax payment voucher, it must clearly indicate payment into the state budget account at the Treasury Office at the same level as the tax authority where the wholesale company registers for tax declaration and the local tax authority where the mining company is located.

The Treasury Office where the wholesale coal consumption company's main office is located shall transfer funds and state budget revenue receipts to related Treasury Offices for recording state budget revenue for the tax of the mining company.

2.3.2. Other production and business establishments producing coal (including cases of internal consumption) shall declare and pay environmental protection tax at the local tax authority where coal is mined.

2.3.4. In cases where the taxpayer is an organization, household, or individual acting as a primary buyer of small-scale coal mining, they shall declare environmental protection tax with the directly managing tax authority of the taxpayer.

3. For imported coal: taxpayers shall declare according to the provisions set forth in item b point 1.3 clause 1 of this Article. In cases of importing raw coal containing anthracite, taxpayers must separately declare the quantity of imported anthracite to pay environmental protection tax according to the prescribed rate for anthracite. If the actual quantity of imported anthracite differs from the declared quantity at the time of import, taxpayers must declare and adjust accordingly.

4. Environmental protection tax shall only be paid once for goods produced or imported. In cases where goods have already been exported and then re-imported into Vietnam, environmental protection tax does not need to be paid upon re-importation.

For organizations and individuals purchasing goods that have already been subject to environmental protection tax for production and business purposes, the environmental protection tax of the purchased goods shall be recorded in the cost of goods sold or production costs. For organizations and individuals selling goods subject to environmental protection tax, the tax-inclusive price shall be used as the basis for calculating value-added tax.

Article 8. Refund of Environmental Protection Tax

The taxpayer of environmental protection tax shall be entitled to a refund of the environmental protection tax already paid under the following circumstances:

1. Goods imported and stored at the port under the supervision of the Customs authority and subject to re-exportation abroad.

2. Imported goods intended for delivery or sale to foreign countries through agents in Vietnam; gasoline and diesel sold to foreign transportation means on routes passing through Vietnamese ports or Vietnamese transportation means on international routes as prescribed by law.

3. Goods temporarily imported for re-exportation under the temporary importation and re-exportation business method shall have the corresponding environmental protection tax refunded upon re-exportation.

4. Goods imported by the importer for re-exportation (including return of goods) abroad shall have the corresponding environmental protection tax refunded for the quantity of goods re-exported abroad.

5. Goods temporarily imported for participation in trade fairs, exhibitions, or product presentations shall have the corresponding environmental protection tax refunded upon re-exportation abroad.

The refund of environmental protection tax as stipulated in this Article shall only apply to goods actually exported. Procedures, documents, sequence, and authority for handling refunds of environmental protection tax for exported goods shall be carried out according to regulations governing the handling of import tax refunds as prescribed by laws on export taxes and import taxes.

Chapter IV
IMPLEMENTATION

Article 9. Allocation of State Budget Revenue

The allocation of the state budget from revenue derived from environmental protection tax shall be implemented in accordance with the provisions of the competent state agency.

Article 10. Effective Date

1. This Circular takes effect from January 1, 2012. Circular No. 06/2001/TT-BTC dated January 17, 2001, issued by the Ministry of Finance guiding the implementation of Decree No. 78/2000/NĐ-CP dated December 26, 2000, of the Government on fuel oil fees, Circular No. 63/2001/TT-BTC dated August 9, 2001, Circular No. 70/2002/TT-BTC dated August 19, 2002, supplementing and amending the aforementioned Circular No. 06/2001/TT-BTC, and the provisions on management of fuel oil fees at Circular No. 28/2011/TT-BTC dated February 28, 2011, issued by the Ministry of Finance, are hereby abolished.

2. Organizations and individuals producing and trading in gasoline and diesel shall not declare and pay environmental protection tax on the quantities of gasoline and diesel that were declared and paid fuel oil fees before January 1, 2012.

3. Provisions on handling violations related to environmental protection tax shall be implemented in accordance with the Law on Tax Administration and guiding documents.

4. Ministries, agencies equivalent to ministries, government agencies, provincial People's Committees, cities directly under the Central Government, and relevant organizations and individuals shall be responsible for implementing this Circular.

In the course of implementation, if there are any difficulties, organizations and individuals are requested to promptly report them to the Ministry of Finance for study and resolution./.