Circular No. 186/1998/TT-BTC guides accounting for export tax, import tax, and special consumption tax.

MINISTRY OF FINANCE ********	SOCIALIST REPUBLIC OF VIETNAM Independence - Freedom - Happiness ********
NUMBER: 186/1998/TT-BTC	HA NOI, December 28, 1998

 

CIRCULAR

OF THE MINISTRY OF FINANCE NUMBER 186/1998/TT-BTC DATED DECEMBER 28, 1998 GUIDING ACCOUNTING FOR EXPORT TAXES, IMPORT TAXES, AND SPECIAL CONSUMPTION TAXES

Pursuant to the Special Consumption Tax Law No. 05/1998/QH10 dated May 20, 1998;
Pursuant to Decree No. 84/1998/NĐ-CP dated October 12, 1998 of the Government and Circular No. 168/1998/TT-BTC dated December 21, 1998 of the Ministry of Finance guiding the implementation of the Special Consumption Tax Law;
Pursuant to the Export Tax and Import Tax Law dated December 26, 1991, the Law Amending and Supplementing Certain Provisions of the Export Tax and Import Tax Law dated July 5, 1993, the Law Amending and Supplementing Certain Provisions of the Export Tax and Import Tax Law No. 04/1998/QH10 dated May 20, 1998, and Decree No. 54/CP dated August 28, 1993;
Pursuant to Decree No. 94/1998/NĐ-CP dated November 17, 1998 of the Government and Circular No. 172/1998/TT-BTC dated December 22, 1998 of the Ministry of Finance guiding the implementation of the Export Tax and Import Tax Law;
Pursuant to Circular No. 13/1998/TT-TCQH dated December 14, 1998 of the General Department of Customs guiding the management of import taxes and VAT for imported raw materials for export production;
The Ministry of Finance guides accounting for export taxes, import taxes, and special consumption taxes as follows:

I- OBJECTS, SCOPE OF APPLICATION

This Circular applies to all enterprises under all economic sectors that produce and trade goods and services subject to export taxes, import taxes, and special consumption taxes.

II- ACCOUNTING FOR EXPORT TAXES AND IMPORT TAXES

1- When exporting goods, accountants base on sales invoices and other relevant documents to calculate, determine, and record the amount of export tax payable, debiting:

Account 511 - Sales Revenue

Credit Account 3333 - Export and Import Taxes (specifically export tax).

2- When importing materials, goods, fixed assets, accountants base on purchase invoices and other relevant documents to calculate, determine, and record the amount of import tax payable, debiting:

Accounts 152, 153, 156, 221, 632, 641, 642,...

Credit Account 3333 - Export and Import Taxes (Detailed for import tax).

3-In cases where import tax paid on goods remaining in customs warehouses under customs supervision and permitted for re-export is refunded, the refunded import tax is recorded as:

Debit Account 3333 - Export and Import Taxes (if deducted from the tax payable in the next period)

Debit Accounts 111, 112 (if refunded in cash).

Credit Accounts 151, 152, 156,...

4-In cases where import tax paid on goods imported but actually imported less than declared is refunded, the refunded import tax is recorded as:

Debit Account 3333 - Export and Import Taxes (if deducted from the tax payable in the next period)

Debit Accounts 111, 112 (if refunded in cash)

Credit Accounts 152, 153, 156, 211,...

5-In cases where export tax paid on exported goods but not actually exported or exported less than declared is refunded, it is recorded as:

Debit Account 3333 - Export and Import Taxes (if deducted from the tax payable in the next period)

Credit Account 511 - Sales Revenue.

Debit Accounts 111, 112 (if refunded in cash)

6-In cases where imported raw materials for export production are eligible for tax refunds corresponding to the export rate of finished products: Upon receipt of the official tax notification from the customs authority regarding the import tax payable, it is recorded as:

Credit Account 3333 - Export and Import Taxes (Detailed for import tax).

Debit Accounts 152, 153,...

+ During the grace period of 275 days, if the enterprise has actually exported the products, the enterprise does not need to pay import tax on the raw materials imported corresponding to the exported products based on the raw material usage standard. If the enterprise has not yet paid the import tax, the import tax not payable on the raw materials imported corresponding to the exported products is recorded as:

Debit Account 3333 - Export and Import Taxes (specifically import tax)

Credit Account 632 - Cost of Goods Sold (if the cost of exported goods has not been transferred)

Credit Account 721 - Extraordinary Income (if the cost of exported goods has been transferred)

+ Outside the grace period of 275 days, if the enterprise has not actually exported the products or has not exported the required quantity of products, the enterprise must pay import tax on the raw materials corresponding to the unsold products. If there are actual exports, the enterprise will be refunded the import tax paid. The refunded import tax is recorded as:

Debit Accounts 111, 112 (if refunded in cash)

Debit Account 3333 - Export and Import Taxes (if deducted from the import tax payable in the next period)

Credit Account 632 - Cost of Goods Sold (if the cost of exported goods has not been transferred)

Credit Account 721 - Extraordinary Income (if the cost of exported goods has been transferred)

7-In cases where import tax paid on temporarily imported goods for re-export under the temporary import-re-export trading method is refunded, it is recorded as:

- When temporarily importing, the value of imported goods and the import tax payable and paid are reflected as:

+ Value of imported goods:

Debit Accounts 151, 156,...

Credit Accounts 331, 111, 112.

+ Import tax payable:

Debit Accounts 151, 156

Credit Account 3333 - Export and Import Taxes (specifically import tax).

+ Import tax paid:

Credit Accounts 111, 112.

Debit Account 3333 - Export and Import Taxes (specifically import tax)

- When re-exporting, no export tax needs to be paid, it is recorded as:

+ Reflecting export revenue:

Debit Accounts 131, 111, 112

Credit Account 511 - Sales Revenue (export price).

+ Reflecting the cost of exported goods:

Debit Account 632 - Cost of Goods Sold (import price including import tax)

Credit Accounts 151, 156.

+ Outside the grace period of 275 days, if the enterprise has not actually exported the products or has not exported the required quantity of products, the enterprise must pay import tax on the raw materials corresponding to the unsold products. If there are actual exports, the enterprise will be refunded the import tax paid. The refunded import tax is recorded as:

- When the import tax is refunded, it is recorded as:

Debit Account 3333 - Export and Import Taxes (if deducted from the import tax payable in the next period)

Credit Account 632 - Cost of Goods Sold (if the cost of exported goods has not been transferred)

Debit Account 3333 - Export and Import Taxes (if deducted from the export tax payable)

8-In cases where export tax paid on temporarily exported goods sent abroad for processing and re-imported as processed products is refunded, it is recorded as:

- When exporting raw materials and goods for processing, it is recorded as:

Debit Account 154 - Production and Business Costs in Progress

Credit Accounts 152, 156,...

- When exporting raw materials and goods for processing, it is recorded as:

- Export tax payable on temporarily exported goods for re-import (of raw materials and goods for processing), it is recorded as:

Credit Account 3333 - Export and Import Taxes.

- When paying export tax on temporarily exported goods for re-import, it is recorded as:

Debit Account 3333 - Export and Import Taxes

Credit Accounts 111, 112,...

- When exporting raw materials and goods for processing, it is recorded as:

Debit Account 3333 - Export and Import Taxes

- Processing costs to be paid, it is recorded as:

- When re-importing processed products, it is recorded as:

Debit Accounts 155, 156,...

Credit Account 154 - Production and Business Costs in Progress.

- Export tax paid on temporarily exported goods for re-import is refunded, it is recorded as:

+ Outside the grace period of 275 days, if the enterprise has not actually exported the products or has not exported the required quantity of products, the enterprise must pay import tax on the raw materials corresponding to the unsold products. If there are actual exports, the enterprise will be refunded the import tax paid. The refunded import tax is recorded as:

Debit Account 155, 156 (If processed goods have not been exported for sale)

Credit Account 632 - Cost of Goods Sold (If processed goods have been consumed)

9 - In cases where goods have been exported but due to some reason must be re-imported into Vietnam, the refund of previously paid export tax shall be recorded as follows:

+ Reflecting the amount to be refunded to the buyer for returned exported goods:

Debit Account 531 - Returned Sales (Export Price)

Credit Account 131, 111, 112 (Export Price)

+ Reflecting the amount of export tax refunded either in cash or deducted from the tax payable in the next period:

+ Outside the grace period of 275 days, if the enterprise has not actually exported the products or has not exported the required quantity of products, the enterprise must pay import tax on the raw materials corresponding to the unsold products. If there are actual exports, the enterprise will be refunded the import tax paid. The refunded import tax is recorded as:

Debit Account 3333 - Export and Import Taxes (if deducted from the tax payable in the next period)

Credit Account 511 - Revenue from Sales (Detailed Export Tax)

+ Reflecting the value of exported goods that need to be re-imported:

Debit Account 155, 156

Credit Account 632 - Cost of Goods Sold

10 - In cases where imported goods must be re-exported or returned to foreign sellers or re-exported to third countries due to some reason, the refund of previously paid import tax and exemption from export tax shall be recorded as follows:

+ Reflecting the value of imported goods returned to foreign sellers:

Debit Account 331 - Payable to Seller (Import Price without Import Tax)

Credit Account 152, 156, 211,...

+ Reflecting the amount of import tax refunded:

Debit Account 3333 - Export and Import Taxes (if deducted from the tax payable in the next period)

Debit Account 111, 112 (if refunded in cash)

Credit Account 152, 156, 211,... (Amount of Import Tax Paid)

11 - In cases where taxpayers mistakenly declare imported goods, they may be refunded overpaid import taxes within one year from the date of discovery. The amount of overpaid import tax due to mistaken declaration shall be recorded as follows:

+ Outside the grace period of 275 days, if the enterprise has not actually exported the products or has not exported the required quantity of products, the enterprise must pay import tax on the raw materials corresponding to the unsold products. If there are actual exports, the enterprise will be refunded the import tax paid. The refunded import tax is recorded as:

Debit Account 3333 - Export and Import Taxes (if deducted from the tax payable in the next period)

Credit Account 152, 156, 211,... (If raw materials and goods have not been sold)

Credit Account 632 - Cost of Goods Sold (If goods have been sold but cost of goods sold has not yet been transferred)

Credit Account 721 - Unusual Income (If goods have been sold and cost of goods sold has already been transferred)

12 - In cases where taxpayers mistakenly declare exported goods, they may be refunded overpaid export taxes within one year from the date of discovery. The amount of overpaid export tax shall be recorded as follows:

Debit Account 111, 112 (if refunded in cash)

Debit Account 3333 - Export and Import Taxes (if deducted from the tax payable in the next period)

Credit Account 511 - Revenue from Sales (if refunded within the accounting period)

Credit Account 721 - Unusual Income (if refunded in the subsequent accounting period)

13 - In cases where taxpayers mistakenly declare exported goods, they must pay back the overpaid export tax within one year from the date of discovery. The amount of export tax to be paid back shall be recorded as follows:

Debit Account 511 - Revenue from Sales (if there is revenue from exported goods in the accounting period)

Debit Account 821 - Unusual Expenses (if there is no revenue from exported goods in the accounting period)

Credit Account 3333 - Export and Import Taxes (specifically export tax).

14 - In cases where taxpayers mistakenly declare imported goods, they must pay back the overpaid import tax within one year from the date of discovery. The amount of import tax to be paid back shall be recorded as follows:

Debit Account 152, 156, 211, 621, 632,...

Debit Accounts 151, 156

15 - In cases of tax fraud, the overpaid export tax or import tax must be recovered. The recovery of export tax or import tax due to tax fraud shall be accounted for similarly to the recovery of overpaid export tax or import tax due to mistaken declaration as specified in Points 11, 12, 13, and 14.

16 - In cases where goods are exempted or reduced in import tax according to the tax regulations, if used for purposes other than those for which the exemption or reduction was granted, the full amount of the exempted or reduced tax must be recovered. The amount of import tax to be recovered shall be recorded as follows:

Debit Account 152, 156, 211, 632,...

Debit Accounts 151, 156

17 - For machinery, equipment, and transportation vehicles temporarily imported, re-exported, or borrowed for re-export by organizations and individuals to implement investment projects, construction, installation, production, and other purposes, when importing, they must declare and pay import tax as prescribed, and upon re-exporting out of Vietnam, they will be refunded the import tax. The amount of import tax refunded shall be recorded as follows:

Debit Account 111, 112 (if refunded in cash)

Debit Accounts 111, 112 (if refunded in cash)

Credit account 211 - Tangible fixed assets.

18 - When paying export and import taxes to the State budget, record:

- When paying export tax on temporarily exported goods for re-import, it is recorded as:

Credit Accounts 111, 112, ...

III - ACCOUNTING FOR SPECIAL CONSUMPTION TAX

1 - When selling goods or services subject to special consumption tax, accountants base on sales invoices to reflect sales revenue at the settlement price, while calculating the special consumption tax payable according to the regulations stipulated in Circular No. 168/1998/TT-BTC dated December 21, 1998 issued by the Ministry of Finance.

Based on the calculated amount of special consumption tax payable, record:

Debit Account 511 - Sales Revenue

Credit Account 3332 - Special Consumption Tax.

2 - When importing goods subject to special consumption tax, accountants base on purchase invoices and notifications of special consumption tax payable to determine the special consumption tax payable for imported goods, record:

Debit Account 152, 156, 211,...

Credit Account 3332 - Special Consumption Tax.

3 - When paying special consumption tax into the State budget, record:

Debit Account 3332 - Special Consumption Tax

Debit Account 3333 - Export and Import Taxes

4 - For temporarily imported goods that have paid special consumption tax, when re-exported, the corresponding amount of special consumption tax paid will be refunded. The amount of special consumption tax refunded by the State budget shall be recorded as follows:

+ Outside the grace period of 275 days, if the enterprise has not actually exported the products or has not exported the required quantity of products, the enterprise must pay import tax on the raw materials corresponding to the unsold products. If there are actual exports, the enterprise will be refunded the import tax paid. The refunded import tax is recorded as:

Debit Account 3332 - Special Consumption Tax (if deducted from the special consumption tax payable in the next period)

Credit Account 632 - Cost of Goods Sold (if the cost of goods re-exported has not yet been transferred in the accounting period)

Credit Account 721 - Unusual Income (if the cost of goods re-exported has already been transferred)

5 - In cases where special consumption tax is refunded for imported goods that have paid special consumption tax based on declarations, but the actual imports are less than declared, or goods are damaged or lost during importation with valid reasons, and special consumption tax has been paid. The amount of special consumption tax refunded by the State budget shall be recorded as follows:

+ Outside the grace period of 275 days, if the enterprise has not actually exported the products or has not exported the required quantity of products, the enterprise must pay import tax on the raw materials corresponding to the unsold products. If there are actual exports, the enterprise will be refunded the import tax paid. The refunded import tax is recorded as:

Debit Account 3332 - Special Consumption Tax (if deducted from the tax payable in the next period)

Credit Account 152, 156, 211,... (if goods have not been sold, raw materials have not been used)

Credit Account 632 - Cost of Goods Sold (if goods have been sold).

6. In cases where imported goods have paid special consumption tax and for some reason must be returned to the exporting country, the amount of special consumption tax paid on the returned goods shall be refunded, recorded as follows:

+ Reflecting the value of imported goods returned to the exporting country, recorded as:

Debit Account 331 - Payable to Supplier (Import Price)

Credit Accounts 152, 156, 211, etc. (Import Price)

+ The amount of special consumption tax refunded by the State budget in cash or deducted from the special consumption tax payable, recorded as:

+ Outside the grace period of 275 days, if the enterprise has not actually exported the products or has not exported the required quantity of products, the enterprise must pay import tax on the raw materials corresponding to the unsold products. If there are actual exports, the enterprise will be refunded the import tax paid. The refunded import tax is recorded as:

Debit Account 3332 - Special Consumption Tax (If deducted from the special consumption tax payable in the following period)

Credit Account 152, 156, 211,...

7. When production and business establishments settle taxes upon merger, division, dissolution, bankruptcy, and there is an overpayment of special consumption tax, the overpaid special consumption tax shall be refunded in cash by the State budget, recorded as:

Debit Accounts 111, 112

Credit Account 3332 - Special Consumption Tax.

8. In cases where production units subject to special consumption tax encounter difficulties due to natural disasters, enemy actions, or unexpected accidents resulting in losses, they may be considered for a reduction in special consumption tax. The reduced amount of special consumption tax will be deducted from the tax payable in the following period, recorded as:

Debit Account 3332 - Special Consumption Tax

Credit Account 511 - Sales Revenue (If the special consumption tax is reduced within the accounting period)

Credit Account 721 - Unusual Income Items (If the special consumption tax is reduced in the subsequent accounting period)

9. In cases where production units subject to special consumption tax encounter difficulties due to natural disasters, enemy actions, causing severe damage, and are unable to continue production, business operations, and tax payments, they may be considered for exemption from special consumption tax on the unpaid portion. The exempted amount of special consumption tax, recorded as:

Debit Account 3332 - Special Consumption Tax

Credit Account 511 - Sales Revenue (If the special consumption tax is exempted within the accounting period)

Credit Account 721 - Unusual Income Items (If the special consumption tax is exempted in the subsequent accounting period)

IV - IMPLEMENTATION

This Circular takes effect from January 1, 1999. Provisions regarding export tax, import tax, and special consumption tax accounting in previously issued accounting regulations that conflict with this Circular are hereby abolished.

During implementation, if there are difficulties or obstacles, please report them to the Ministry of Finance for research and supplementary guidance.

TRAN VAN TA (Signed)