Circular No. 18/01/TT-BTC guides the non-collection and refund of price difference revenue for imported materials and raw materials used to produce goods for export processing.

CIRCULAR

Guidelines on not collecting or refunding price difference revenue for imported materials and raw materials used to produce goods for export

- Based on Decision No. 195/1999/QD-TTg dated September 27, 1999 of the Prime Minister on establishing and managing the Export Support Fund;

- Implementing the guidance of the Prime Minister in Government Circular No. 1112/CP-KTTH dated December 4, 2000 regarding not collecting or refunding price differences;

The Ministry of Finance guides the non-collection and refunding of price difference revenue for imported materials and raw materials used to produce goods for export as follows:

I. GENERAL PROVISIONS

1. Scope and Applicability

This Circular guides the non-collection and refunding of price difference revenue for enterprises with imported materials and raw materials subject to price difference payment according to Decision No. 195/1999/QD-TTg dated September 27, 1999 of the Prime Minister on establishing and managing the Export Support Fund (hereinafter referred to as Decision No. 195/1999/QD-TTg), but used to produce exported goods or to process for foreign countries and then export under signed contracts.

2. Implementation Method

2.1. Imported materials and raw materials for processing for foreign countries and then exporting under signed contracts shall not pay the price difference at the time of importation;

2.2. Imported materials and raw materials subject to price difference collection, if used to produce exported goods, will be subject to the deadline for paying the price difference as stipulated for paying import tax under Point b, Clause 3, Article 4 of Decree No. 94/1998/NĐ-CP dated November 17, 1998 of the Government detailing the Law Amending and Supplementing Certain Provisions of the Law on Export Tax, Import Tax No. 04/1998/QH10 dated May 20, 1998.

2.3 If the deadline specified in Subparagraph 2.2 of this point has passed and the enterprise has not yet exported the product, the enterprise must pay the price difference for the imported materials and raw materials as currently regulated. When exporting the product, the enterprise will be refunded the amount of price difference paid corresponding to the actual imported materials and raw materials used to produce the exported product.

II. GUIDANCE ON NON-COLLECTION AND REFUNDING OF PRICE DIFFERENCE REVENUE

1. For imported materials and raw materials for processing exported goods

1.1. The procedures and documentation applicable to cases of non-payment of price difference as stipulated in Subparagraph 2.1, Point 2, Part I of this Circular are implemented simultaneously and in accordance with the procedures and formalities for exempting import tax on imported materials and raw materials for processing for foreign countries and then exporting under signed contracts.

1.2. The Customs Office of the province or centrally administered city where the enterprise handles the import procedures (hereinafter referred to as the Customs Authority) bases on the tax exemption documentation for imported materials and raw materials to issue a decision on non-payment of price difference simultaneously with the issuance of a decision to exempt import tax for each specific case.

1.3. The non-payment of price difference for imported materials and raw materials stipulated in Subparagraph 2.1, Point 2, Part I of this Circular only applies to the actual materials and raw materials put into production of exported products and have been decided to exempt import tax accordingly.

2. For imported materials and raw materials for producing exported goods

2.1. To apply the deadline for paying the price difference stipulated in Subparagraph 2.2, Point 2, Part I of this Circular, enterprises must have complete documentation meeting the conditions stipulated in Point 2, Part III, Section C of Circular No. 172/1998/TT-BTC dated December 22, 1998 of the Ministry of Finance guiding the implementation of Decree No. 54/CP dated August 20, 1993, Decree No. 94/1998/NĐ-CP dated November 17, 1998 of the Government detailing the implementation of the Law on Export Tax, Import Tax and Laws Amending and Supplementing Certain Provisions of the Law on Export Tax, Import Tax (hereinafter referred to as Circular No. 172/1998/TT-BTC).

2.2. Based on the prescribed documentation, the Customs Authority issues a notice of the deadline for paying the price difference to the enterprise, while opening a record to determine the amount of price difference the enterprise must pay (if any) when exporting the product.

2.3. If within the deadline for paying the price difference, the enterprise has already exported the product, the enterprise sends a letter requesting non-payment of the price difference to the Customs Authority.

2.3.1. Based on the enterprise's request letter, the Customs Authority checks the documentation and issues a decision on non-payment of the price difference for each specific case.

2.3.2. Non-payment of the price difference only applies to the quantity of imported materials and raw materials that have been decided not to pay import tax and is implemented simultaneously with the decision not to pay import tax.

2.4. If beyond the deadline for paying the price difference stipulated in Subparagraph 2.2, Point 2, Part I of this Circular, the enterprise does not export finished products, the enterprise must pay the price difference for the imported materials and raw materials as currently regulated. In case the enterprise delays payment of the price difference, it will be handled as a violation similar to the case of delayed payment of import tax stipulated in Point 1, Part I, Section G of Circular No. 172/1998/TT-BTC dated December 22, 1998 of the Ministry of Finance.

3. Refunding the collected price difference revenue for imported materials and raw materials used to produce exported goods after paying the price difference as prescribed

3.1. The procedures and formalities for refunding the price difference for cases mentioned in Subparagraph 2.3, Point 2, Part I of this Circular are carried out in accordance with the procedures and formalities for refunding import tax on imported materials and raw materials used to produce exported goods stipulated in Circular No. 172/1998/TT-BTC.

3.2. In addition to the documentation stipulated in Point 1, Part I, Section E of Circular No. 172/1998/TT-BTC, enterprises applying for refund of the price difference must also provide the following documentation:

a) A letter from the enterprise requesting refund of the paid price difference, clearly stating the amount of price difference paid and the amount requested for refund;

b) Receipts for payment of the price difference (or proof of payment into the state budget, or a confirmation from the State Treasury about the amount of price difference paid).

3.3. The Customs Authority shall base its decision to refund price differences on the above regulations for each specific case. The refund of price differences shall be carried out simultaneously with the refund of import tax (if applicable). The amount of refunded price difference shall correspond to the imported materials and raw materials that have been refunded import tax (if applicable) and shall not exceed the amount of price difference actually paid by the enterprise into the State budget as confirmed by the Treasury. Enterprises will not be entitled to a refund of price differences for materials and raw materials determined as not meeting the conditions for refunding previously paid import tax.

3.4. Based on the decision to refund price differences issued by the Customs Authority, the Treasury of the province or centrally governed city shall implement the refund of price differences to enterprises. The source of the refund shall be recorded in the account of the Export Support Fund opened at the Treasury.

4. Collection of Overpaid Price Differences

4.1. Enterprises with imported materials and raw materials subject to non-refundable price differences as stipulated in Clause 2.1, Point 2, Part I of this Circular, if they use such materials and raw materials for purposes other than those specified as the basis for non-refundable price differences, must declare and pay back the overpaid price differences.

4.2. The basis for calculating the collection of overpaid price differences shall be implemented according to the principle of calculating price differences prescribed in Clause 1.1, Point 1, Part I, Section B of Circular No. 150/1999/TT-BTC dated December 21, 1999, guiding the implementation of Decision No. 195/1999/QĐ-TTg, and shall be applied according to the provisions in effect at the time of calculating the collection of overpaid price differences.

4.3. The deadline for declaring and paying back the overpaid price differences and the deadline for collecting overpaid price differences shall be determined according to the deadline for collecting overdue import tax as stipulated in Part II, Section E of Circular No. 172/1998/TT-BTC.

III. IMPLEMENTATION

1. This circular takes effect from January 1, 2001.

2. In the course of implementation, if there are any difficulties, it is requested that ministries, sectors, localities, and enterprises report to the Ministry of Finance for research and supplementary guidance./.