Circular No. 19 TC/TCT guiding the implementation of Decree No. 193/CP dated December 29, 1994 of the Government on stamp duty

CIRCULAR

DEPARTMENT OF FINANCE DECISION NO. 19 TC/TCT DATED MARCH 16, 1995 GUIDING THE IMPLEMENTATION OF GOVERNMENT DECREE NO. 193/CP DATED DECEMBER 29, 1994 ON STAMP DUTIES

Pursuant to Government Decree No. 193/CP dated December 29, 1994 on stamp duties;

The Ministry of Finance hereby provides guidance as follows:

I. OBJECTS SUBJECT TO PAYMENT AND SUBMISSION OF STAMP DUTIES:

1. Objects subject to stamp duties:

According to Article 1 of Government Decree No. 193/CP, assets that must be registered with state management agencies for ownership rights and usage rights as prescribed by law shall be subject to stamp duties, including:

- Houses, including residential houses, office buildings, factories, warehouses, shops, stores, and other architectural works;

- Land, including residential land, construction land, agricultural land, forestry land, aquaculture land, salt-making land, and other types of land;

- Various types of ships and boats, including river and sea vessels, canoes, barges, ferries, rafts, and other waterway transportation means;

- Various types of automobiles, including cranes, excavators, bulldozers, rollers, four-wheeled motor vehicles with engines, and replacement engine assemblies that must be re-registered with state management agencies;

- Various types of motorcycles, including two-wheeled motorcycles, three-wheeled motorcycles, lam cars, farm trucks, rickshaws, and other motorized vehicles;

- Hunting guns and sports guns of various types.

2. Subjects required to pay stamp duties shall comply with the provisions of Article 2 of Government Decree No. 193/CP dated December 29, 1994.

In cases where international treaties to which Vietnam is a party provide different provisions, such provisions shall apply.

3. Stamp duties shall not be collected in the following cases:

a/ Land permitted by competent state authorities for public use as stipulated in Article 58 of the Land Law, including: land for road construction, bridges, culverts, sidewalks, water supply and drainage systems, rivers, lakes, dykes, dams, schools, hospitals, markets, parks, flower gardens, playgrounds for children, squares, stadiums, airports, ports, and other public facilities as prescribed by the Government;

b/ Land permitted by competent state authorities for mineral exploration, exploitation, and scientific research involving experiments on plants and animals directly conducted on the land.

If such land is used for constructing residential houses, office buildings, and other structures, including research institutes, stamp duties must be paid according to the regulations.

c/ Land initially allocated by the State where the land user has already paid land use fees as stipulated in Item a, Point 1, Section I of Circular No. 02 TC/TCt dated January 4, 1995 issued by the Ministry of Finance (including land with state-owned houses where the land use fee was included in the house sale price to the state budget according to Government Decree No. 61/CP dated July 5, 1994).

For land initially allocated by the State for agricultural, forestry, aquaculture, and salt-making purposes without payment of land use fees under the Land Law, no stamp duties will be levied. However, if organizations or individuals receive land use rights from other organizations or individuals for these purposes, they must pay stamp duties.

d/ Buildings and land serving as diplomatic offices, consular offices, and residences of heads of foreign consular offices in Vietnam;

e/ Assets exclusively used for national defense and security purposes, such as:

- Buildings and land serving as headquarters for military units, military bases, national defense works, battlefields, special works, military stations, military industrial, scientific, and technical works serving national defense, economic integration with national defense, military warehouses, shooting ranges, training grounds, weapons testing sites, military schools, military hospitals, military shelters, and other land and buildings used for national defense and security purposes as specified by the Government in specific cases;

- Various types of ships and boats of national defense and security units tasked with protecting national security on rivers and seas;

- Various types of automobiles and motorcycles, and firearms exclusively used for combat and readiness purposes by national defense and security units, including fire trucks.

When organizations or individuals belonging to the national defense and security forces use assets for production, business, or other purposes, they are exempt from paying stamp duties. If such assets are transferred or sold to other organizations or individuals not using them for national defense and security purposes, the recipient organization or individual must pay stamp duties.

g/ Commemorative houses, including land attached to the house registered in the name of the person receiving the gift, which is a war veteran, family of martyrs, person contributing to the revolution, disabled person, or orphaned elderly person or child under the age of majority without support.

k/ Special-use vehicles registered in the name of a disabled person.

h/ Assets resulting from organizational division or merger requiring re-registration or transfer between regions within Vietnam without changing the asset owner, specifically:

- Assets previously registered for ownership and usage rights, subsequently divided or merged and re-registered under the name of the organization resulting from the division or merger according to the decision of the competent authority.

In cases where jointly owned assets of a married couple are re-registered after divorce and property division, stamp duties will not be levied on the value of the assets received.

- Assets previously registered for ownership and usage rights, subsequently transferred between regions within Vietnam without changing the asset owner during re-registration.

In cases where assets are transferred internally within an organization, between affiliated accounting units or reporting units (which are not separate legal entities), or between affiliated accounting units or reporting units and the organization according to the decision of the competent authority, it is considered that there is no change in the asset owner.

n/ Houses and land compensated for the part of the house and land reclaimed by the State.

In cases where houses and land are reclaimed but have not yet been granted ownership certificates for houses or land use rights by the State and have not paid the stamp duty, if now the State compensates and allows registration of ownership of houses and land use rights, they must still pay the stamp duty before registering with the competent state management agency.

II/ BASIS FOR CALCULATING THE STAMP DUTY:

According to Article 4 of Decree No. 193/CP dated December 29, 1994 of the Government, the stamp duty is calculated as a percentage (%) of the asset value at market price at the time of registration. The amount of stamp duty to be paid is determined as follows:

Amount Asset Value

Stamp Duty Rate = Asset Value x Stamp Duty

Amount Due Stamp Duty Rate Before Registration

1. The asset value for calculating the stamp duty is based on the market price in Vietnam at the time of registration.

In certain specific cases, the asset value for calculating the stamp duty is determined as follows:

a/ Land value for calculating the stamp duty:

Area Price

Land Value for Stamp Duty = Area Subject to Stamp Duty x Price per Square Meter

Before Registration (VND) (m2) (VND/m2)

- The area subject to stamp duty includes the entire actual land area within the premises of organizations or individuals permitted to register for use.

- The price per square meter (VND/m2) is set by the People's Committee of provinces or centrally governed cities according to the framework of land prices issued by the Government.

In cases where land is received through auction or together with the purchase of a state-owned house, the stamp duty calculation price remains the price set by the provincial or city People's Committee.

For land that has been developed with multi-story buildings for multiple households, the stamp duty calculation price for each floor shall be implemented according to the adjustment coefficient specified in item b, point 2, Article 7 of Decree No. 61/CP dated July 5, 1994 of the Government.

For agricultural, forestry, aquaculture, and salt-making land changing usage rights, the stamp duty calculation price is the agricultural land price. However, if authorized state agencies permit the change of land use purpose from agricultural, forestry, aquaculture, and salt-making land to construction land or other purposes, the stamp duty calculation price is the non-agricultural land price.

b/ House value for calculating the stamp duty:

Area Price

House Value for Stamp Duty = House Area Subject to Stamp Duty x Price per Square Meter

Before Registration (VND) (m2) (VND/m2)

- The house area subject to stamp duty includes the total floor area of the house, including the area of accompanying facilities of organizations or individuals when registering ownership and use rights.

- The price per square meter (VND/m2) for new houses applies the newly constructed price of each level and category of house as prescribed by the provincial or city People's Committee at the time of registration.

For old houses already in use, the remaining value of the house is determined based on the remaining quality ratio of the house and the construction price at the time of registration. The Tax Department may request the provincial or city People's Committee to establish a committee consisting of representatives from Tax, Finance and Price Control, Construction, and Real Estate (if applicable) to accurately and objectively assess the house value for stamp duty.

In cases where a multi-story house has multiple households living on different floors, the stamp duty calculation price for each floor shall be implemented according to the adjustment coefficient specified in item b, point 1, Article 7 of Decree No. 61/CP dated July 5, 1994 of the Government.

c/ The value for calculating the stamp duty for ships, cars, motorcycles, hunting guns, and sports guns is the market value in Vietnam at the time of registration.

Based on market prices during specific periods, the Tax Department is responsible for coordinating with relevant local authorities to develop and publicly report the minimum standard price list for calculating the stamp duty applicable within the locality for each type of ship, boat, car, motorcycle, hunting gun, and sports gun. When market prices fluctuate by 10% or more (either increase or decrease), the stamp duty calculation price must be adjusted promptly to match reality and reported to the Ministry of Finance (General Department of Taxation) no later than 15 days after the decision to adjust prices.

When calculating and collecting the stamp duty, if the asset value recorded on the stamp duty declaration form and the purchase invoice of the person paying the stamp duty is lower than the standard price set by the provincial or city People's Committee, the stamp duty calculation price is the minimum standard price set by the provincial or city People's Committee; if the asset value recorded on the declaration form or invoice is higher than the minimum standard price, the stamp duty calculation price is the actual price recorded on the purchase and sale invoice declared by the person paying the stamp duty.

2. The stamp duty rate (%) applied to specific types of assets is as follows:

a/ Houses, land, various types of ships: 2% (two percent)

b/ Cars, motorcycles, hunting guns, sports guns: 4% (four percent)

The maximum stamp duty for a single asset for a single registration is capped at VND 500 million (five hundred million dong).

III/ DECLARATION AND PAYMENT OF THE STAMP DUTY:

1. Organizations and individuals purchasing or receiving assets subject to stamp duty as stipulated in point 1, Section I of this Circular (including assets exempt from stamp duty) before registering ownership or use rights with the competent state management agency, are responsible for:

a/ Declaring fully and truthfully to the tax authority about the situation and condition of the asset according to the model attached to this Circular no later than 30 days from the date of completion of the transfer procedures between both parties confirmed by a state notary office or the authorized People's Committee of the district or county.

The stamp duty declaration form is made in two copies, sent to the Tax Authority responsible for organizing the collection of stamp duties.

Upon receipt of the stamp duty declaration form submitted by organizations or individuals, the Tax Authority must check the file and declared data to confirm on the declaration form according to the prescribed model: one copy serves as a notification of stamp duty payment, and one copy is retained by the Tax Authority.

In complex cases requiring time for inspection and verification, the declarant of the stamp duty declaration may request the Tax Authority to issue a "Receipt for Stamp Duty Declaration Form" specifying: the documents included in the file attached with the declaration form, the date of receipt of the declaration form, and the date of issuance of the result.

b. Provide complete and be legally responsible for the truthfulness of the documents related to the calculation of stamp duty, such as:

- For land, the following valid documents must be provided:

+ If the land is granted by the State, there must be: the notification of land allocation and the plot map of the competent state management agency on land; proof of payment of the full land use fee (payment receipt or land use fee payment certificate confirmed by the treasury office) or the decision of the competent authority exempting the payment of the land use fee according to the Land Use Fee Law.

+ If the land is transferred, assigned, exchanged, given, or inherited from another organization or individual, there must be proof of the lawful land use right of the person transferring the land and the person receiving the lawful land use right; the declaration form for the transfer of land use rights tax accompanied by proof of payment of the full transfer of land use rights tax or the decision of the competent authority exempting the payment of the transfer of land use rights tax according to the Law on Transfer of Land Use Rights.

+ For land regularized under Decree No. 60/CP dated July 5, 1994 of the Government, valid documents regarding residential land as prescribed by law must be provided.

In cases where a single plot of land is bequeathed to multiple heirs, a division agreement signed and confirmed by all co-heirs according to the inheritance law or a decision of a final judgment must also be provided.

- For houses, the following valid documents must be provided:

+ If the house is purchased, assigned, exchanged, given, or inherited, or entrusted, there must be proof of the lawful ownership of the house of the person transferring the house; documents transferring the house between the lawful transferee and transferor.

In cases of purchasing a house owned by the State, there must be a decision to sell the house by the competent authority and a sales invoice showing full payment for the house (issued by the Ministry of Finance).

- For ships, boats, cars, motorcycles, and firearms, valid documents proving the legitimate origin of the property must be provided, such as:

+ If the property was acquired through a registered ownership or usage in legitimate imports or sales invoices and declarations of import origin (issued by the Ministry of Finance).

+ If the property was acquired through registered ownership or usage within the country, there must be proof of the lawful ownership and usage of the property by the person transferring the property; documents transferring the property between the lawful recipient and transferor. For liquidated assets, a decision on asset liquidation by the competent authority and a sales invoice for liquidated assets (a type of invoice issued by the Ministry of Finance) must also be provided.

+ If the property was acquired through confiscation, there must be a confiscation decision, a decision on the disposal of confiscated goods by the competent authority, and a sales invoice issued to the buyer (a type of invoice issued by the Ministry of Finance).

c) Pay the full stamp duty into the State budget, the procedures are as follows:

Based on the stamp duty payment notice issued by the Tax Authority (recorded on the stamp duty declaration form), the stamp duty payer directly pays the money into the National Treasury according to the instructions of the stamp duty collection agency. In places far from the Treasury, making it inconvenient for the payer to pay the stamp duty, the Tax Authority will directly collect the stamp duty.

When paying the stamp duty into the National Treasury, a payment slip issued by the Ministry of Finance (in cash or by bank transfer) must be used. The payment slip must clearly specify: chapter, type, clause, category corresponding to the name of the organization or individual paying the stamp duty, item 24 "stamp duty" in the State budget ledger. The Treasury Office, upon receiving the stamp duty payment, must confirm on the payment slip "money received," sign, stamp, and circulate according to regulations.

When the Tax Authority directly collects the stamp duty, when collecting the money, they must issue a stamp duty payment receipt (code CTT06) to the payer. The stamp duty payment receipt must clearly specify the name of the organization or individual paying the stamp duty, item 24 "stamp duty" in the State budget ledger.

The linked payment slip for stamp duty already confirmed by the Treasury Office or the linked stamp duty payment receipt issued by the Tax Authority to the payer, together with the stamp duty declaration form, serves as proof that the full stamp duty has been paid when registering ownership and usage rights of the property and is kept in the file of the State management agency overseeing the property. If an organization or individual who has paid the stamp duty requests a payment receipt for accounting purposes, the Treasury Office or the Tax Authority must provide an additional "receipt for payment" (issued by the Ministry of Finance), accurately recording the amount paid, the number and series of the payment slip or stamp duty payment receipt, to avoid duplicate accounting entries.

Organizations or individuals declaring stamp duty at the Tax Branch must pay the money into the Treasury where the Tax Branch is located or at the Tax Branch where the declaration is made (if the Tax Authority directly collects the money). If the stamp duty is declared at the Tax Department (Stamp Duty Collection and Other Revenue Section), the money must be paid into the Treasury where the Tax Department conducts transactions or submitted to the Stamp Duty Collection Section where the declaration is made (in cases where the Tax Authority directly collects the money).

2) The Tax Authority organizing the collection of stamp duty shall have the following duties and powers:

a. Guide organizations and individuals to strictly comply with the declaration and payment of stamp duty.

The organization of stamp duty declaration and collection must be coordinated with the location where the State management agency organizes the registration of ownership and usage rights of property, specifically as follows:

- The Tax Branch where the People's Committee of the district, town, or city has the authority to organize registration and issue certificates of ownership and usage rights for real estate is responsible for organizing the collection of stamp duty on real estate within its jurisdiction.

- The Department of Taxation (Division of Stamp Duty and Other Taxes) shall directly collect stamp duty on: ships; boats; automobiles; motorcycles; hunting guns; sports guns; houses and land located in the inner city districts of cities where provincial People's Committees or centrally governed cities have their headquarters, and such collection shall not be delegated to lower levels.

For Ho Chi Minh City, due to the large number of assets subject to stamp duty, the Department of Taxation may organize the collection of stamp duty in accordance with local circumstances to ensure timely, full, and accurate payment of stamp duty into the state budget and convenience for taxpayers.

b. Check the declaration documents, assess the actual status of the asset to calculate, approve, and notify the amount of stamp duty payable, the deadline for payment, and the place of payment in accordance with regulations.

Record in ledgers, retain, and preserve the file of each asset that has paid stamp duty for monitoring, comparison, and inspection when necessary.

c. Collect and pay stamp duty into the state budget for cases where the Tax Authority directly collects money.

Stamp duty collected on a given day must be deposited into the state budget on the same day. In cases where the Tax Authority is far from the treasury, deposits must be made once every five days, but if the amount collected reaches up to 100 million VND, it must be immediately deposited into the state budget on the same day.

Timely account for the collection and payment of stamp duty according to chapters, types, items, and categories corresponding to the objects subject to stamp duty under item 24 "stamp duty" in the state budget ledger. Monthly, quarterly at the latest by the 10th day of the month, cross-check the stamp duty declaration form and the payment receipt or stamp duty collection receipt to determine the amount of stamp duty to be collected, already collected, and paid into the state budget of the previous month and quarter, and report to the higher-level tax authority.

d. Prepare minutes, impose administrative penalties within the scope of authority or request the competent authority to handle in accordance with the law;

e. Examine and resolve complaints about the collection and payment of stamp duty within the scope of authority and prescribed regulations.

3) State management agencies with authority shall organize registration of ownership and usage rights for assets subject to stamp duty, and are responsible for coordinating with the Tax Authority to inspect compliance with the guidance provided in this Circular. At the same time, they can only issue certificates of ownership and usage rights after the organization or individual has paid the National Treasury (in cases where payment is made into the treasury) or received the stamp duty collection receipt issued by the Tax Authority (in cases where the Tax Authority directly collects payment) consistent with the amount of stamp duty payable as stated in the payment notice (the declaration form approved by the authorized Tax Authority).

IV. VIOLATION HANDLING AND COMPLAINT RESOLUTION:

1) Organizations and individuals who fail to complete the declaration procedures fully or do not pay the full amount of stamp duty as stipulated in this Circular shall not be granted certificates of ownership and usage rights.

2) Organizations and individuals who delay payment of stamp duty into the state budget beyond the deadline specified in the Tax Authority's notice shall be fined 0.02% (two ten-thousandths) of the delayed amount for each day of delay.

Organizations and individuals who intentionally evade stamp duty (registering ownership and usage rights without paying stamp duty; altering the stamp duty amount to match the asset value when registering...) shall, in addition to paying the full amount of stamp duty as guided in this Circular, also be subject to fines ranging from one to three times the evaded stamp duty amount depending on the severity of the violation. Serious violations may result in criminal liability as prescribed by law.

The authority and procedures for imposing penalties as stipulated herein shall be implemented in accordance with the Government Decree and the Circular of the Ministry of Finance guiding the implementation of Government Decree No. 01/CP dated October 18, 1992 on administrative penalties in the field of taxation.

3) Organizations and individuals who abuse their positions or powers to misappropriate, embezzle, or cause loss of stamp duty funds shall compensate the State for the entire amount of misappropriated, embezzled, or lost stamp duty funds and be subject to disciplinary action, administrative penalties, or criminal liability as prescribed by law depending on the severity of the violation.

Tax authorities and officials; State management agencies and officials who violate the collection and payment system of stamp duty or shield illegal acts related to the collection and payment of stamp duty shall be subject to disciplinary action, administrative penalties, or criminal liability as prescribed by law depending on the severity of the violation.

4) Organizations and individuals who discover cases of evading stamp duty and harassment during the process of collecting and paying stamp duty shall be rewarded according to the reward system in the field of taxation prescribed by the State.

5) Organizations and individuals who pay stamp duty have the right to complain about the improper implementation of Government Decree No. 193/CP and the guidance provided in this Circular. Complaints must be sent to the Tax Authority directly responsible for collecting stamp duty.

The agency receiving the complaint must examine and resolve it within thirty days from the date of receipt. For complex complaints, the period may be extended, but not exceeding sixty days from the date of receipt.

If the complainant disagrees with the decision of the receiving agency or has not been resolved within the above period, they have the right to appeal to the higher-level Tax Authority of the receiving agency. The decision of the Minister of Finance is final.

6) The Tax Authority must refund improperly collected stamp duty or fines within thirty days from the date of receipt of the effective decision on handling. Organizations and individuals who improperly collect in violation of the law in this case shall be subject to disciplinary action depending on the severity of the violation, and if repeated, they must be removed from the Tax Authority or face criminal liability as prescribed by law.

7) If fraud, evasion of stamp duty, or errors in stamp duty are discovered and concluded, the Tax Authority has the right to order supplementary collection or refund of the stamp duty payable based on the asset value at the time of fraud or evasion, calculated at the current price at the time of stamp duty.

V. IMPLEMENTATION:

1) Tax authorities at all levels shall be responsible for coordinating with state management agencies to implement registration of ownership and usage rights of assets to organize collection and inspection of compliance with the stamp duty collection system in accordance with Government Decree No. 193/CP dated December 29, 1994, and the guidance provided in this Circular.

2) This Circular shall take effect from January 1, 1995. However, previous regulations on stamp duties that conflict with Government Decree No. 193/CP and the guidance provided in this Circular shall be abolished. The procedures for collecting stamp duties on vehicles sold through installment payments, which were previously guided by Circular No. 403TC/TCT dated February 24, 1994, issued by the Ministry of Finance, shall continue to be implemented until new regulations are issued.

In certain specific cases, the following shall apply:

a. For real estate assets such as houses and land, if organizations or individuals purchase or receive before December 31, 1987 (when the State had not yet issued Decree No. 222/HĐBT on stamp duties), and have not been granted certificates of ownership or usage rights and have not paid stamp duties, they must pay stamp duties for the final transfer (no need to pay for previous transfers prior to December 31, 1987); if purchased or received from January 1, 1988 (the date when Decree No. 222/HĐBT on stamp duties came into force), each transfer must be registered with the state management agency and stamp duties must be paid separately for each transfer (except in cases where payment is not required).

b) For movable property such as boats, automobiles, motorcycles, hunting rifles, and sports guns, if they have not been used and have not been granted certificates of ownership or usage rights by the state management agency, they must only pay stamp duties when registering with the state management agency; if certificates of ownership or usage rights have already been granted, each change of ownership must be re-registered with the state management agency and stamp duties must be paid.

c) For organizations or individuals who have declared stamp duties to the tax authority before December 31, 1994:

- If they have been notified by the tax authority to pay stamp duties before December 31, 1994 (notification in writing specifying the amount to be paid, the payment date, and the payment location), they must pay stamp duties according to the amount specified in the notification.

- If there has been no notification of stamp duties from the tax authority or the notification of the deadline for paying stamp duties was after December 31, 1994, they must pay stamp duties in accordance with the provisions of Government Decree No. 193/CP dated December 29, 1994.

d) In cases where fraud or evasion of stamp duties is discovered (such as not paying stamp duties but registering ownership or usage rights with the state management agency...), the stamp duties must be collected according to the stamp duty regime in effect at the time of registration with the state management agency, and in addition, penalties for fraudulent behavior regarding stamp duties as stipulated in Point 2, Section IV of this Circular shall be imposed. If state management agencies shield fraudulent behavior concerning stamp duties, they shall be penalized according to the provisions in Point 3, Section IV of this Circular.

e) Organizations and individuals declaring and paying stamp duties from January 1, 1995, must pay stamp duties in accordance with the provisions of Government Decree No. 193/CP dated December 29, 1994.

In cases where more than the required amount has been collected according to the provisions of Government Decree No. 193/CP, the excess amount must be refunded to the payer in full, calculated as the difference between the amount paid according to the rate specified in Government Decree No. 222/HĐBT minus the stamp duty payable according to the rate specified in Government Decree No. 193/CP. Local tax, finance, and state treasury agencies shall complete the refund process by March 31, 1995, ensuring no inconvenience to the refund recipients.

3) It is requested that Ministers, Heads of government agencies, central Party bodies, and mass organizations; Chairpersons of People's Committees at all levels, based on their functions, tasks, and authorities, direct the implementation in accordance with the provisions of Government Decree No. 193/CP dated December 29, 1994, and the guidance provided in this Circular.

During the implementation process, if any difficulties arise, it is requested that agencies promptly report them to the Ministry of Finance for research and supplementary guidance.