Decision No. 1632/1998/QT-BTC on the issuance of the Regulation on the establishment, management, and use of the value-added tax refund fund

GENERAL PROVISIONS

Article 1:

Establish a centralized VAT refund fund at the Central State Treasury to implement VAT refunds for entities specified in Article 16 of the Value Added Tax Law; Clause 15 of Decree

The VAT refund fund shall open an account at the Central State Treasury authorized by the Minister of Finance to the Director General of the State Revenue Administration as the account holder.

Article 2:

Sources for forming the VAT refund fund shall be drawn from the revenue of value added tax on imported goods; the rate of draw shall be decided by the Minister of Finance based on the proposals of the Director General of the State Revenue Administration and the Director of the Budget Department.

Article 3:

Tax authorities, the Budget Department, and the State Treasury shall perform the establishment of the VAT refund fund and the refund of VAT to eligible entities according to the provisions of these regulations.

SPECIFIC PROVISIONS

Article 4:

Budget estimates for VAT collection and refund:

1\. Annually, tax authorities shall estimate the amount of VAT to be refunded during the year to eligible entities as stipulated in Article 1 of these regulations through the following procedures:

- The Tax Branch shall estimate the amount of VAT to be refunded to eligible entities under its direct management, compile and submit to the Tax Bureau.

- The Tax Bureau shall estimate the amount of VAT to be refunded to eligible entities under its direct management, and simultaneously compile the total amount of VAT to be refunded to eligible entities within the province or city and submit to the State Revenue Administration.

- The State Revenue Administration shall be responsible for compiling the total amount of VAT to be refunded to eligible entities nationwide and submit to the Budget Department for inclusion in the state budget revenue estimate to be submitted to the Minister of Finance.

2\. Based on the estimated VAT revenue from imported goods and the estimated amount of VAT to be refunded, the State Revenue Administration and the Budget Department shall estimate the amount to be set aside for the next year's VAT refund fund from the VAT revenue on imported goods and report to the Minister of Finance for decision. During implementation, if the VAT refund fund is insufficient to cover actual refunds, the Budget Department shall report to the Minister of Finance to promptly supplement the refund fund source for eligible entities.

Article 5: Setting up the VAT refund fund

Based on the rate of setting aside for the VAT refund fund decided by the Minister of Finance, monthly, upon the proposal of the Director General of the State Revenue Administration, the Budget Department shall process temporary advances from the state budget into the VAT refund fund account of the State Revenue Administration at the Central State Treasury.

Article 6:

Implementing VAT refunds for production and business establishments:

1\. After receiving the refund application documents from eligible entities, tax authorities shall proceed as follows:

a\. For entities subject to tax under the direct management of the Tax Branch, if they are entitled to a refund according to the prescribed regime, the Tax Branch shall be responsible for reviewing the documents and confirming the amount of VAT to be refunded to the Tax Bureau for consideration and issuance of the refund decision for these entities.

b\. For entities entitled to a refund under the direct management of the Tax Bureau, the Tax Bureau shall be responsible for reviewing the documents and issuing the refund decision for these entities.

c\. For special cases and for certain State-owned enterprises established pursuant to Decision 90/TTg dated March 7, 1994 and Decision 91/TTg dated March 7, 1994 of the Prime Minister, if the refund is centralized at the enterprise headquarters, the Tax Bureau shall be responsible for reviewing, considering, and confirming the amount of VAT to be refunded for each unit, reporting to the State Revenue Administration, and the Minister of Finance authorizing the Director General of the State Revenue Administration to issue the refund decision for these entities.

2\. Within five days of receiving the refund decision, the State Treasury shall complete the refund process for eligible entities.

- For entities entitled to a refund decided by the Minister of Finance, the State Revenue Administration shall prepare a payment authorization along with the refund decision to withdraw funds from the VAT refund fund and send it to the Central State Treasury to implement the refund for the entity.

- For entities entitled to a refund decided by the Tax Bureau Director (including those directly managed by the Tax Bureau and those directly managed by the Tax Branch), the Tax Bureau shall prepare the refund decision along with the payment authorization and send it to the provincial or centrally-administered municipal State Treasury to process the refund for these entities from the VAT refund account. Simultaneously, they shall be responsible for processing payments with the VAT refund fund opened at the Central State Treasury.

3\. In case the VAT refund fund balance is exhausted, the Central State Treasury shall be responsible for temporarily advancing funds from the treasury to implement refunds for eligible entities according to Clause 2, Article 6 of these regulations, and notify the Budget Department to settle the temporarily advanced amount.

RESPONSIBILITIES OF AUTHORITIES IN VAT REFUNDS

Article 7:

The tax authorities at all levels shall be responsible for:

1. The General Department of Taxation shall be tasked with:

a- Estimating the amount of value-added tax to be refunded in the year.

b- Based on the estimated annual VAT refund, coordinating with the State Budget Department to determine the monthly, quarterly level of fund establishment for the VAT refund account and the estimated VAT refund amount for each province and city to send to the State Treasury as a basis for implementation.

c- Implementing the refund of value-added tax for taxpayers eligible for refunds as stipulated in point c, Clause 1, Article 6 of this Regulation.

d- Directing and inspecting the VAT refund process of provincial tax bureaus.

đ- Managing the VAT refund fund opened at the Central State Treasury.

Reporting promptly on the situation of VAT refunds to eligible recipients every ten days to the Ministry and sending copies to the State Budget Department.

Preparing a report monthly on the amount of VAT refunds to eligible recipients (with confirmation from the State Treasury) to report to the Ministry and sending copies to the State Budget Department.

Settling the VAT refund fund, preparing settlement reports according to prescribed regulations.

2. Provincial Tax Bureaus and Local Tax Branches shall be responsible for:

a- Building estimates of the amount of VAT to be refunded in their respective areas and reporting to higher-level tax authorities as prescribed.

b- Conducting inspections and issuing decisions (for Provincial Tax Bureaus) or recommending Provincial Tax Bureaus to issue decisions (for Local Tax Branches) regarding the payment of VAT refunds to eligible recipients as stipulated by Law and being accountable to the General Department of Taxation for VAT refund decisions in their respective areas.

c- Reporting detailed information on VAT refunds to eligible recipients every ten days to the General Department of Taxation.

d- Preparing detailed accounting reports monthly on VAT refunds to eligible recipients in their respective areas (with confirmation from the State Treasury) within their management responsibility and reporting to higher-level tax authorities as prescribed.

Article 8: The State Budget Department shall be responsible for:

a- Based on the estimated refund expenditure and import VAT revenue budget, coordinating with the General Department of Taxation to determine the level of fund establishment for the VAT refund account from import VAT revenue sources.

b- Temporarily allocating funds into the VAT refund account to ensure timely payment sources for units.

c- Monthly coordinating with the General Department of Taxation and the Central State Treasury to adjust downward the import VAT revenue (corresponding to the temporary allocation into the VAT refund account) and adjust downward the temporary allocation from the budget into the VAT refund account. Being responsible for the source to implement VAT refunds according to the decision of the Minister of Finance.

Article 9:

The State Treasury shall be responsible for:

a- Opening a VAT refund account as stipulated in Article 2 of this Regulation.

b- Guiding provincial treasuries to open current accounts for VAT refund payments to eligible recipients in their respective provinces according to the guidance of the Central State Treasury.

c- Implementing VAT refund payments to eligible recipients according to the decision of the Minister of Finance or the Director of Provincial Tax Bureaus in accordance with the time specified in Clause 2, Article 6 of this Regulation.

d- Confirming the amount of VAT actually paid to eligible recipients in each province and city.

IMPLEMENTATION

Article 10:

Heads of Tax Authorities, State Treasuries, and the State Budget Department shall be responsible for guiding and organizing implementation in accordance with the provisions of this Regulation.

During implementation, if there are any difficulties, they are advised to report to the Ministry of Finance for review and timely adjustment and supplementation.