Circular No. 4325/TC/TCT regarding the recovery of profits from the sale of used cars

LETTER

OF THE MINISTRY OF FINANCE NUMBER 4325 TC/TCT ON MAY 7, 2002
OF THE MINISTRY OF FINANCE ON THE COLLECTION OF PROFITS FROM THE SALE OF MOTOR VEHICLES

Respected: - Ministries, agencies at the ministerial level,

- Government agencies,

- People's Committees of provinces and centrally governed cities,

Implementing the directive of the Prime Minister in Circular No. 182/VPCP-KTTH dated January 11, 2002 and Circular No. 1805/VPCP-KTTH dated April 5, 2002 of the Government Office on the collection of profits from the sale of motor vehicles, the Ministry of Finance guides the collection of profits for motor vehicles permitted by the Prime Minister to be imported for public passenger transport in certain localities but not used for the intended purpose of importation and sold outside the province, as follows:

1- OBJECTS AND SCOPE OF APPLICATION:

1.1- Subject:

Used motor vehicles that were permitted by the Prime Minister to be imported for public passenger transport in certain provinces and cities but not used for the intended purpose of importation and sold outside the province (excluding those vehicles permitted by the Prime Minister to be imported for exchange purposes) fall within the scope of profit collection.

1.2- Scope of application: The cases subject to profit collection include vehicles sold outside the province when meeting all of the following conditions:

- Passenger-carrying motor vehicles with more than 16 seats, used and with a time period from the year of import to the year of manufacture exceeding five years (including both registered and unregistered vehicles).

- Permitted by the Prime Minister and the Ministry of Trade for import in 2000 and 2001.

- The letter of credit for import was opened before June 30, 2001 and the actual import of vehicles was completed before December 31, 2001.

2- Method of calculating the profit to be collected and the method of collection. receipt.

2.1- Method of calculating the profit to be collected:

2.1.1- In the case where the enterprise selling the motor vehicle outside the province is the direct importer:

The amount of profit to be collected = Selling price of the vehicle - Import cost - Taxes paid - Reasonable expenses incurred.

Selling price of the vehicle: Is the price excluding value-added tax according to the value-added tax invoice.

Import cost: Is the import price according to the foreign trade contract.

Taxes paid: Import tax and special consumption tax (if applicable) paid according to the customs declaration at the import stage.

Reasonable expenses incurred: Are expenses directly related to the import, purchase, and sale of motor vehicles, as guided by Circular No. 18/2002/TT-BTC dated February 20, 2002 of the Ministry of Finance. These expenses must have legitimate documentation as prescribed.

2.1.2- In the case where the enterprise selling the motor vehicle outside the province purchases the vehicle from another enterprise within the province:

The amount of profit to be collected = Selling price of the vehicle - Purchase cost of the vehicle - Reasonable expenses incurred.

Selling price of the vehicle: Is the price excluding value-added tax according to the value-added tax invoice.

Purchase cost of the vehicle: Is the purchase price excluding value-added tax according to the value-added tax invoice.

Reasonable expenses incurred: Are expenses directly related to the import, purchase, and sale of motor vehicles, as guided by Circular No. 18/2002/TT-BTC dated February 20, 2002 of the Ministry of Finance. These expenses must have legitimate documentation as prescribed.

2.2- Entity responsible for paying the profit to be collected: Is the enterprise or individual (hereinafter referred to as the enterprise) selling the motor vehicle outside the province.

2.3- Deadline for payment of profit: Not later than 45 days from the date of signing this circular. Enterprises subject to profit collection must declare and pay the profit to the provincial tax office according to the guidance provided in point 2.1 above. If more than 45 days pass without the enterprise selling the motor vehicle outside the province paying the profit to be collected, it will be subject to late payment penalties, with a daily penalty rate of 0.1% of the profit due. If there is no declaration for profit collection, the enterprise will be subject to full profit collection, late payment penalties, and fines ranging from one to five times the profit due depending on the severity of the violation.

2.4- All profits collected from the sale of motor vehicles shall be remitted to the central government budget.

2.5- In the case where the selling price of the motor vehicle according to the value-added tax invoice is lower than the actual market selling price in the locality: In addition to the profit collection as stipulated above, organizations and individuals selling the vehicle will also be subject to value-added tax and corporate income tax collection according to the guidelines issued by the Ministry of Finance implementing Decision No. 41/2002/QĐ-TTg dated March 18, 2002 of the Prime Minister. Provincial People's Committees

3- IMPLEMENTATION ORGANIZATION:

shall instruct subordinate units and individuals who have motor vehicles subject to profit collection under this guidance to declare and submit to the provincial tax office the following documents to process profit collection. - Declaration form detailing: Motor vehicles sold outside the province (type of motor vehicle, year of manufacture, number of seats, chassis number, engine number, Customs Declaration Form for imported goods), selling price of the vehicle, import cost or purchase cost, taxes paid (accompanied by a copy of the tax payment receipt stamped with confirmation of authenticity by the enterprise) and other reasonable expenses, the profit the enterprise proposes to pay.

- Foreign trade contract (if applicable).

- Sales contract.

- Documents of expenses incurred during the importation or purchase of the motor vehicle.

- Payment vouchers.

- Purchase invoices (if the enterprise selling the vehicle is an enterprise purchasing imported vehicles from another enterprise).

Provincial tax offices shall issue decisions to collect profits and require enterprises to remit to the state budget the profits collected from the sale of motor vehicles outside the province, according to the guidance in this circular.

For motor vehicles sold outside the province but not yet registered for circulation, only after completing the profit collection process can the public security authority, based on the profit collection receipt and the required documents, allow the vehicle to be registered for circulation according to current regulations.

It is requested that the Provincial People's Committees instruct subordinate enterprises to comply strictly with the Prime Minister's regulations when importing vehicles. Any sales of motor vehicles outside the province after the date of signing this circular will not be registered for circulation, and upon discovery, they will be subject to penalties according to the law.

It is requested that ministries, central agencies, provincial people's committees, and relevant agencies coordinate to implement these directives. In the case of selling a car to another province after the date this letter is signed, registration for circulation will not be granted, and upon discovery, penalties will be imposed according to the provisions of the law.

We request that the Ministries, central agencies, People's Committees of provinces and centrally governed cities, and related agencies coordinate to direct implementation.