Circular No. 39-TC/TCT guiding the implementation of Decision No. 156-HÐBT and Decision No. 157-CT dated May 16, 1991 of the Council of Ministers.

CIRCULAR

NUMBER 39-TC/TCT OF JULY 1, 1991 GUIDING THE IMPLEMENTATION OF RESOLUTION NUMBER 156-HĐBT AND RESOLUTION NUMBER 157-CT OF MAY 16, 1991 OF THE STATE COUNCIL

Implementing Decision No. 156-HĐBT dated May 16, 1991 of the State Council on amending and supplementing the regime for goods and foreign currency carried to or sent back to Vietnam by individuals going abroad for labor cooperation, expert cooperation, work, or study, and Decision No. 157-CT dated May 16, 1991 of the Chairman of the State Council on the regime for goods and foreign currency brought back to Vietnam by overseas Vietnamese when returning home to visit family, and by Vietnamese residing abroad sending back to help relatives. The Ministry of Finance guides the implementation of the specific provisions in the aforementioned decisions as follows:

I. REGARDING INDIVIDUALS GOING ABROAD FOR LABOR COOPERATION, EXPERT COOPERATION, WORK, OR STUDY.

1. Regarding the subjects exempted from non-trade import tax:

According to Article 1 and Article 3 of Decision No. 156-HĐBT dated May 16, 1991 of the State Council, individual citizens of Vietnam dispatched by the state for labor cooperation, expert cooperation, work, or short-term or long-term study abroad, regardless of which country, shall be exempt from non-trade import tax on goods they carry or send back to Vietnam according to the following tax exemption quotas:

2. Regarding tax exemption quotas and methods of determination:

a) Number of times goods can be sent or brought back exempt from tax:

- During the period dispatched by the state for labor cooperation, expert cooperation, work, or study abroad, each person may only be exempt from tax once per year (from January 1 to December 31), regardless of whether they bring or send goods back multiple times during that year (the first time in the year).

- For those who have been abroad for many years and did not send or bring goods back in previous years, from now on, they will also only be exempt from tax once per year through sending or bringing goods back.

b) Tax exemption quota for goods:

The tax exemption quota for goods sent or brought back, as mentioned in point a above, includes quotas based on item type and value, specifically:

+ If the goods brought or sent back include two motorcycles or televisions and video players, then one motorcycle or one television and one video player can be exempt from tax. In cases where the sender only brings one television or one video player, they can choose to be exempt from tax on two televisions or two video players, depending on their choice. Other items if permitted for import must pay non-trade import tax (for items listed in the tariff).

+ If the goods brought or sent back do not include motorcycles or televisions and video players, the sender can be exempt from tax based on the value of the goods according to the following levels (the remaining goods must pay non-trade import tax):

- Value of $1,000 for encouraged import goods.

- Value of $500 for restricted import goods.

- If the consignment includes both encouraged and restricted import goods, the sender can choose one of the two tax exemption quotas. If neither type of goods reaches the tax exemption quota, the two types of goods can be combined to meet the quota for tax exemption. The combination ratio is 1 USD of restricted goods equals 2 USD of encouraged goods.

Example: Mr. Nguyen Van A went to Germany for labor cooperation, and in the year he sent back a consignment valued at $1,200, including $800 worth of encouraged import goods and $400 worth of restricted import goods.

If Mr. A chooses to be exempt from tax on encouraged import goods, in addition to the $800 worth of encouraged import goods being exempt from tax, Mr. A can also be exempt from tax on $100 = ($1,000 - $800) / 2 worth of restricted import goods. Thus, the total value of goods exempt from tax for Mr. A is $900.

Conversely, if Mr. A chooses to be exempt from tax on restricted import goods, according to the ratio of 1/2, in addition to the $400 worth of restricted import goods, Mr. A can also be exempt from tax on $200 = ($500 - $400) x 2 worth of encouraged import goods. Thus, the total value of goods exempt from tax for Mr. A is $600.

c) Method of determining the tax exemption quota: Based on the inventory list of goods brought or sent back classified as encouraged import goods or restricted import goods (the list of these two types of goods is specified by the Ministry of Commerce). Based on the price list for non-trade import goods tax issued by the Ministry of Finance, customs authorities calculate the value of the goods inventoried. At the same time, based on the exchange rate for tax purposes between the Vietnamese Dong and USD at the time of inspection and the tax exemption quota, the total value of goods exempt from tax in Vietnamese Dong is determined.

On this basis and the request of the sender, the customs authority compares to determine the specific quantity of goods exempt from tax according to the quota for the sender.

d) Regarding the time limit for paying tax and confiscation of motorcycles, televisions, and video players exceeding the quota; within three months from May 20, 1991, for motorcycles, televisions, and video players exceeding the quota upon arrival at the border, the sender or recipient must pay non-trade import tax. From August 21, 1991 onwards, all motorcycles, televisions, and video players brought back exceeding the quota will be considered illegal imports and confiscated for handling according to current regulations.

3. Bringing or sending foreign currency back to purchase tax-exempt goods:

According to Decision No. 156-HĐBT dated May 16, 1991 of the State Council, all Vietnamese going abroad for labor, expertise, work, or study are only exempt from tax according to the quotas already guided above.

For Vietnamese workers who recently returned from Iraq, they still enjoy tax-exempt purchases according to Point 4 of Circular No. 1058-PPLT dated April 9, 1991 of the Office of the State Council. Sales of tax-exempt goods to these groups are implemented in accordance with the spirit of Circular No. 406-TC-TCT/NV3 dated May 30, 1991 of the General Tax Department.

For Vietnamese workers in Germany who returned before May 20, 1991, temporarily suspended, awaiting a policy decision from the State Council.

II - REGARDING GOODS CARRIED BY VIETNAMESE OVERSEAS BRANCHES WHEN RETURNING TO THE COUNTRY TO VISIT FAMILY AND GOODS SENT BACK BY VIETNAMESE RESIDENTS ABROAD TO ASSIST RELATIVES.

1. Pursuant to Decision No. 157-CT dated May 16, 1991 of the Chairman of the Council of Ministers, all goods permitted for import carried by Vietnamese overseas branches when returning to the country to visit family and sent back by Vietnamese residents abroad to assist relatives must pay non-trade import tax and customs fees. When visiting family, personal luggage and items according to the standard defined by Customs are exempt from import tax.

2. The collection of non-trade import tax on goods permitted for import by the above subjects shall be implemented strictly in accordance with the provisions of Decree No. 391-HĐBT dated November 10, 1990 of the Council of Ministers and Circular No. 62-TCT/CT dated December 10, 1990 of the Ministry of Finance. For goods that are materials, equipment, machinery serving production brought back by Vietnamese overseas branches and Vietnamese residents abroad, based on the State's import encouragement policy at each time, the Ministry of Finance will consider exemptions and reductions of non-trade tax on a case-by-case basis.

III - IMPLEMENTATION:

1. The exemption of taxes on goods carried or sent back by Vietnamese who have returned from working, collaborating as experts, working, and studying abroad shall be organized and implemented by the Customs Department in accordance with the tax exemption quota specified in Decision No. 156-HĐBT and this Circular.

The Ministry of Finance assigns the General Tax Department to coordinate in monitoring and inspecting the implementation of the above regulations by the Customs Department.

2. This Circular replaces previous guiding documents of the Ministry of Finance regarding import tax on goods imported by the above subjects.