Circular No. 23 TC/TCT guides the handling of automobiles and two-wheeled motorcycles with engines that have been illegally imported and are currently in circulation within certain military units.

CIRCULAR

DIRECTIVE OF THE MINISTRY OF FINANCE NO. 23 TC/TCT OF APRIL 26, 1996 GUIDING PROCEDURES FOR EXEMPTION FROM TAXES FOR ENTERPRISES DEDICATED TO DISABLED WORKERS

BASED ON THE TAX LAWS, CURRENT TAX ORDINANCES, AND DECREE NO. 81/CP OF NOVEMBER 23, 1995 OF THE GOVERNMENT GUIDING THE IMPLEMENTATION OF CERTAIN ARTICLES OF THE LABOR CODE CONCERNING DISABLED WORKERS; THE MINISTRY OF FINANCE ISSUES GUIDELINES ON PROCEDURES FOR EXEMPTING TAXES FOR ENTERPRISES DEDICATED TO DISABLED WORKERS AS FOLLOWS:

For office premises of agencies and units under the Ministry of Public Security and the Ministry of Defense, they shall be implemented according to separate guidelines issued by the Ministry of Public Security and the Ministry of Defense after consultation with the Ministry of Finance.

a. ENTERPRISES DEDICATED TO DISABLED WORKERS (INCLUDING WAR INVALIDS AND VETERANS), INCLUDING STATE ENTERPRISES, PRIVATE ENTERPRISES, LIMITED LIABILITY COMPANIES, JOINT-STOCK COMPANIES, COOPERATIVES, AND PRODUCTION GROUPS ESTABLISHED IN ACCORDANCE WITH LEGAL REGULATIONS, WHICH MEET THE FOLLOWING CONDITIONS, SHALL BE ELIGIBLE FOR TAX EXEMPTION UNDER ARTICLE 10 OF DECREE NO. 81/CP OF NOVEMBER 23, 1995 OF THE GOVERNMENT:

- RECOGNIZED BY THE PEOPLE'S COMMITTEE OF THE PROVINCE OR CITY DIRECTLY UNDER THE CENTRAL GOVERNMENT AS AN ENTERPRISE DEDICATED TO DISABLED WORKERS.

- STRICTLY COMPLY WITH THE REQUIREMENTS FOR MAINTAINING ACCOUNTING RECORDS AND USING PURCHASE AND SALE DOCUMENTS ACCORDING TO THE CURRENT REGULATIONS.

- POSSESS A BUSINESS LICENSE ISSUED BY THE AUTHORIZED GOVERNMENT AGENCY.

- EMPLOY AT LEAST 10 WORKERS, OF WHOM AT LEAST 51% MUST BE DISABLED WORKERS CONFIRMED BY A QUALIFIED HEALTH AUTHORITY. FOR PRIVATE ENTERPRISES, LIMITED LIABILITY COMPANIES, JOINT-STOCK COMPANIES, COOPERATIVES, AND PRODUCTION GROUPS, IN ADDITION TO DISABLED WORKERS, THE REMAINING WORKERS MUST MAINLY BE RELATIVES OF DISABLED WORKERS OR SHAREHOLDERS WITH MANAGEMENT SKILLS, SPECIALIZED KNOWLEDGE, AND TECHNICAL EXPERTISE.

- HAVE A REGULATION OR CHARTER SUITABLE FOR DISABLED WORKERS AND THE MANAGEMENT OF AN ENTERPRISE MAINLY COMPOSED OF DISABLED WORKERS.

- REGISTER FOR TAX PAYMENT WITH THE TAX AUTHORITY.

b. THIS DIRECTIVE DOES NOT APPLY TO THE FOLLOWING CASES:

- ENTERPRISES OPERATED BY DISABLED PERSONS WHO DO NOT MEET THE CONDITIONS STATED IN POINT a OF SECTION 1 OF THIS DIRECTIVE.

- ENTERPRISES OPERATED BY DISABLED PERSONS ENGAGED IN TRADING.

- ENTERPRISES DEDICATED TO DISABLED WORKERS WITH FIXED BUSINESS LOCATIONS THAT DO NOT COMPLY WITH THE DOCUMENTATION REQUIREMENTS FOR GOODS IN CIRCULATION ON THE MARKET WHEN PURCHASING GOODS, TRANSPORTING GOODS FOR SALE, OR EXCHANGING THEM MUST PAY TAXES ACCORDING TO THE ACTIVITIES OF TRADING.

II. TYPES OF TAXES EXEMPTED:

ENTERPRISES DEDICATED TO DISABLED WORKERS (HEREINAFTER REFERRED TO AS "ENTERPRISES") THAT MEET THE CONDITIONS STATED IN POINT 1 ABOVE SHALL BE EXEMPT FROM THE FOLLOWING TYPES OF TAXES DURING THE BUSINESS PROCESS:

- BUSINESS INCOME TAX;

- PROFIT TAX;

- PROPERTY TAX;

- AGRICULTURAL LAND USE TAX.

III. PROCEDURES AND AUTHORITY FOR TAX EXEMPTION:

a. PROCEDURES AND AUTHORITY FOR EXEMPTING BUSINESS INCOME TAX AND PROFIT TAX:

THE CONSIDERATION OF TAX EXEMPTION FOR REVENUE AND PROFIT TAXES FOR ENTERPRISES DEDICATED TO DISABLED WORKERS SHALL BE CONDUCTED ANNUALLY. ENTERPRISES SHALL ONLY BE EXEMPT FROM TAXES FOR THE BUSINESS ACTIVITIES LISTED IN THEIR BUSINESS LICENSES. IF THEY ENGAGE IN OTHER PRODUCTION ACTIVITIES NOT LISTED IN THE LICENSE, THEY MUST PAY TAXES ACCORDING TO THE CURRENT TAX LAWS AND ORDINANCES. AFTER THE END OF THE BUSINESS YEAR, ENTERPRISES MUST PREPARE AND SUBMIT APPLICATIONS FOR TAX EXEMPTION TO THE AUTHORIZED AUTHORITIES. THE APPLICATION FOR TAX EXEMPTION SHALL INCLUDE:

- A REQUEST FOR TAX EXEMPTION FROM THE ENTERPRISE ACCOMPANIED BY A CONFIRMATION FROM THE DIRECTLY RESPONSIBLE TAX AUTHORITY.

- A BUSINESS LICENSE.

- TAX REGISTRATION.

- A DECISION FROM THE PEOPLE'S COMMITTEE OF THE PROVINCE OR CITY DIRECTLY UNDER THE CENTRAL GOVERNMENT CONFIRMING THE ENTERPRISE AS ONE DEDICATED TO DISABLED WORKERS.

- A FINAL AUDIT REPORT FROM THE DIRECTLY RESPONSIBLE TAX AUTHORITY.

- AN ANNUAL FINAL REPORT FROM THE PRODUCTION AND BUSINESS UNIT.

WITHIN 30 DAYS FROM THE DATE OF RECEIVING THE APPLICATION, THE AUTHORIZED TAX AUTHORITY MUST ISSUE A DECISION ON TAX EXEMPTION OR NOTIFY THE ENTERPRISE OF THE REASONS FOR NON-APPROVAL OR DENIAL. THE DECISION ON TAX EXEMPTION MUST SPECIFY THE AMOUNT OF EACH TYPE OF TAX EXEMPTED AND THE TOTAL AMOUNT OF TAX EXEMPTED FOR THE ENTERPRISE IN THE YEAR.

TO ENSURE TIMELY BUDGET COLLECTION AND AVOID DIFFICULTIES FOR ENTERPRISES, THE DIRECT MANAGING TAX AUTHORITY IS RESPONSIBLE FOR CHECKING THE ACCOUNTING RECORDS AND ACTUAL BUSINESS OPERATIONS OF THE ENTERPRISE AND COMPARING THEM WITH THE TAX EXEMPTION CONDITIONS STATED IN SECTION 1 OF THIS CIRCULAR TO DECIDE TEMPORARILY SUSPENDING MONTHLY TAX COLLECTION FOR THE ENTERPRISE'S LISTED BUSINESS ACTIVITIES AND MANAGING TAXES FOR OTHER ACTIVITIES OUTSIDE THE LICENSED BUSINESS.

IN CASE THE ENTERPRISE BRINGS GOODS OR RAW MATERIALS TO SELL IN ANOTHER PLACE (OUTSIDE THE PROVINCE OR CITY DIRECTLY UNDER THE CENTRAL GOVERNMENT) WITHOUT A CLEAR BUYER ADDRESS, THE ENTERPRISE MUST HAVE A STOCK REMOVAL ORDER, A STOCK REMOVAL FORM, AND A CERTIFICATE FROM THE DIRECT MANAGING TAX AUTHORITY REGARDING THE ACTUAL QUANTITY AND TYPE OF GOODS OR RAW MATERIALS REMOVED FROM STOCK. THE ENTERPRISE MUST PRESENT ALL THESE DOCUMENTS TO THE TAX AUTHORITY AT THE SELLING LOCATION. WHEN SELLING, THE ENTERPRISE MUST ISSUE AN INVOICE TO THE BUYER AND APPLY FOR TAX EXEMPTION WITH THE TAX AUTHORITY AT THE SELLING LOCATION. THE APPLICATION FOR TAX EXEMPTION SHALL INCLUDE:

- AN APPLICATION FOR TAX EXEMPTION FROM THE ENTERPRISE ACCOMPANIED BY A CERTIFICATION FROM THE DIRECT MANAGING TAX AUTHORITY THAT THE ENTERPRISE IS ELIGIBLE FOR TAX EXEMPTION AND THAT THE SOLD GOODS OR RAW MATERIALS ARE CONSISTENT WITH THE BUSINESS ACTIVITIES LISTED IN THE LICENSE.

- A COPY OF THE BUSINESS LICENSE (CERTIFIED TRUE COPY);

- A DECISION FROM THE PEOPLE'S COMMITTEE OF THE PROVINCE OR CITY DIRECTLY UNDER THE CENTRAL GOVERNMENT CONFIRMING THE ENTERPRISE AS ONE DEDICATED TO DISABLED WORKERS (CERTIFIED TRUE COPY).

THE TAX AUTHORITY AT THE SELLING LOCATION IS RESPONSIBLE FOR PROVIDING SALES INVOICES, MANAGING TAX COLLECTION, AND RESOLVING TAX EXEMPTION APPLICATIONS FROM ENTERPRISES WITHIN 15 DAYS FROM THE DATE OF RECEIVING THE APPLICATION.

ENTERPRISES SHALL ONLY BE ELIGIBLE FOR TAX EXEMPTION FOR THE ACTUAL QUANTITY OF GOODS OR RAW MATERIALS REMOVED FROM STOCK AS CONFIRMED BY THE DIRECT MANAGING TAX AUTHORITY. IF THE ENTERPRISE SELLS GOODS OR RAW MATERIALS NOT LISTED IN THE LICENSE OR EXCEEDS THE QUANTITY ALREADY CONFIRMED BY THE DIRECT MANAGING TAX AUTHORITY, THE ENTERPRISE MUST DECLARE AND PAY THE FULL TAX TO THE TAX AUTHORITY AT THE SELLING LOCATION ACCORDING TO THE LAW.

The tax authority has the power to issue decisions to exempt revenue tax and profit tax for production and business establishments exclusively for disabled workers as follows:

- The Director of the Tax Department examines and decides to grant tax exemption for production and business establishments managed by localities with an average monthly revenue tax exemption up to five million VND; and a profit tax exemption of fifty million VND per year.

- THE DIRECTOR GENERAL OF THE NATIONAL TAX COLLECTING AGENCY SHALL REVIEW AND DECIDE ON TAX EXEMPTION FOR ENTERPRISES UNDER CENTRAL MANAGEMENT AND LOCAL ENTERPRISES WITH AN AVERAGE MONTHLY REVENUE EXEMPTION OF MORE THAN 5 MILLION DONG TO 50 MILLION DONG PER MONTH AND AN ANNUAL PROFIT EXEMPTION OF MORE THAN 50 MILLION DONG TO 100 MILLION DONG.

- The Minister of Finance examines and grants tax exemption for all production and business establishments with an average monthly revenue tax exemption exceeding fifty million VND; and a profit tax exemption exceeding one hundred million VND per year.

b. Procedures and authorities for granting exemptions on real estate tax and agricultural land use tax shall be carried out in accordance with the current laws and regulations on real estate tax and agricultural land use tax.

IV. IMPLEMENTATION ORGANIZATION:

IF THERE ARE CHANGES IN THE CONDITIONS DURING THE BUSINESS YEAR THAT RESULT IN THE ENTERPRISE NO LONGER MEETING THE ELIGIBILITY CRITERIA FOR TAX EXEMPTION AS STATED IN SECTION 1 OF THIS CIRCULAR, THE ENTERPRISE MUST REPORT TO THE DIRECT MANAGING TAX AUTHORITY WITHIN 5 DAYS OF THE CHANGE TO TERMINATE THE TAX EXEMPTION PROCESS AND THE ENTERPRISE MUST DECLARE AND PAY TAXES ACCORDING TO THE LAW.

IF THE ENTERPRISE ENGAGES IN FRAUDULENT ACTIVITIES TO OBTAIN TAX EXEMPTION, IT WILL NOT BE ELIGIBLE FOR ANY TAX EXEMPTION FOR THE ENTIRE BUSINESS YEAR. IN ADDITION TO DENIAL OF TAX EXEMPTION, THE ENTERPRISE MAY ALSO BE SUBJECT TO ADMINISTRATIVE PENALTIES OR CRIMINAL LIABILITY DEPENDING ON THE GRAVITY OF THE VIOLATION.

TAX OFFICERS OR OTHER PERSONS WHO ABUSE THEIR POSITIONS OR POWERS TO INTENTIONALLY ISSUE FALSE CERTIFICATIONS OR COVER UP TO ALLOW ENTERPRISES TO OBTAIN TAX EXEMPTIONS AS STATED IN THIS CIRCULAR, CAUSING DAMAGE TO THE STATE BUDGET, SHALL BE SUBJECT TO DISCIPLINARY ACTION, ADMINISTRATIVE PENALTIES, OR CRIMINAL LIABILITY DEPENDING ON THE GRAVITY OF THE VIOLATION.

The tax administration agency directly managing production and business establishments exclusively for disabled workers must maintain a record book and retain all relevant documents concerning tax exemptions. Annually, provincial tax bureaus must compile the total amount of taxes exempted for production and business establishments under their jurisdiction and submit reports to the General Tax Department no later than the end of the first quarter of the following year.

This Circular takes effect from the date of issuance. Point 2, Section II of Circular No. 09-TT/LB issued by the Joint Ministry of Labor - Invalids and Social Affairs - Finance - State Planning Committee guiding the implementation of Decision No. 15-TTg dated October 20, 1992 of the Prime Minister on policies for production and business establishments of war invalids, wounded veterans, and disabled persons is hereby abolished.

In the course of implementation, if there are difficulties, units are requested to promptly reflect them to the Ministry of Finance for research and resolution.