Circular No. 79 TC/TCT GUIDELINES ON DOCUMENTATION REGIMES FOR GOODS IN CIRCULATION ON THE MARKET

CIRCULAR

GUIDELINES ON DOCUMENTATION FOR GOODS IN MARKET CIRCULATION

circulating in the market

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BASED on current tax laws and regulations;

BASED on Decision No. 60 TTg dated February 8, 1994 of the Prime Minister regarding certain policies and measures to manage economic and social development in 1994;

To manage goods in market circulation, to promote the implementation of invoice and documentation requirements when buying and selling goods and providing services for payment purposes.

The Ministry of Finance hereby provides guidelines on documentation for goods in market circulation as follows:

I. GENERAL PROVISIONS

1. Goods produced domestically and imported goods circulating in the market must be accompanied by valid documentation proving the lawful origin of the consignment.

2. All types of invoices, invoices combined with warehouse withdrawal slips, internal transportation slips combined with warehouse withdrawal slips, tax receipts, and payment receipts mentioned in this Circular must be original copies issued uniformly by the Ministry of Finance.

II. REGARDING DOMESTICALLY PRODUCED GOODS

A. REGARDING INDUSTRIAL GOODS

Organizations and individuals engaged in transporting domestically produced industrial goods must have the following documents:

1. Goods sold to buyers or purchased by buyers for resale or for production purposes must be accompanied by a sales invoice or an invoice combined with a warehouse withdrawal slip from the seller.

2. If transporting goods or raw materials for sale in another province or municipality where the buyer's address is unknown, a warehouse withdrawal order and a warehouse withdrawal slip from the unit must accompany the goods. Upon arrival at the sales location, the seller must report to the local tax authority and issue an invoice to the buyer upon sale, declaring and paying turnover tax at the sales location.

3. When transporting goods from the main facility to branches or stores outside the district or county, an internal dispatch order and an internal transportation slip combined with a warehouse withdrawal slip from the unit must accompany the goods.

4. If transporting goods or raw materials for exchange with other facilities, a sales invoice or an invoice combined with a warehouse withdrawal slip must accompany the goods.

5. If transporting goods for consignment sale or delivery to agents, a warehouse withdrawal order and an internal transportation slip combined with a warehouse withdrawal slip from the unit must accompany the goods. For production units subject to special consumption tax, an invoice combined with a warehouse withdrawal slip must accompany the goods.

6. When transporting goods from one warehouse to another or from one branch to another, an internal dispatch order and an internal transportation slip combined with a warehouse withdrawal slip must accompany the goods.

7. Non-state-owned economic entities engaged in fixed business operations when purchasing goods for resale or for production purposes must have a purchase record book attached, confirmed by the directly managing tax authority, along with the seller’s invoice. The goods transported and recorded on the invoice and in the book must match the actual goods transported.

8. Entities engaged in wholesale trade when purchasing goods and transporting them must have a sales invoice from the seller and a receipt for turnover tax and income tax paid before transporting the goods.

B. REGARDING AGRICULTURAL, FOREST, AND MARINE PRODUCTS

Agricultural, marine, and forest products specified in this section refer to agricultural, fishery, and forestry products directly produced or harvested by farmers, fishermen, salt producers without processing or only preliminary processing such as drying, sun-drying, sorting for preservation...

Processed agricultural, marine, and forest products when circulating in the market shall apply the documentation requirements as stipulated for industrial goods in point A of this Circular.

1. State-owned economic entities purchasing agricultural, marine, and forest products for resale or production purposes must have the following documents:

- If purchasing from state-owned enterprises, collective economic units, companies, private enterprises, individual households... a sales invoice or an invoice combined with a warehouse withdrawal slip from the seller must accompany the goods.

- If purchasing directly from farmers, fishermen (producers), a detailed list (according to model number 1 attached) must be established, clearly stating the date of purchase, name, address of the seller, quantity, value of each type of goods... When transporting goods out of the purchase location (district), the tax authority must confirm the goods transported on the list.

- If setting up a collection station, the collection station must establish a list as described above when purchasing from farmers, fishermen (direct producers). When transporting goods out of the collection area, a warehouse withdrawal order from the unit and an internal transportation slip combined with a warehouse withdrawal slip from the collection station must accompany the goods.

- If entering into a contract to purchase goods with organizations and individuals engaged in business, a sales invoice or an invoice combined with a warehouse withdrawal slip from the entity must be provided.

2. Non-state-owned economic entities purchasing agricultural, forest, and marine products for resale or processing, when transporting, must have the documents as stipulated for state-owned entities above (point 1), in addition to a purchase record book confirmed by the tax authority, detailing the product, quantity, purchase value, place of departure, destination...

3. Entities engaged in wholesale trade when purchasing agricultural, marine, and forest products and transporting them must have the documents as stipulated for state-owned entities above (point 1) and a receipt for turnover tax and income tax paid during circulation.

III. REGARDING IMPORTED GOODS

A. REGARDING MINOR IMPORTED GOODS

Point 2, Section II of Directive No. 94 CT dated March 25, 1992 of the Chairman of the Council of Ministers (now the Prime Minister) on organizing and managing the border market between Vietnam and China in the new situation stipulates:

"In the exchange and trading of goods between residents on both sides of the border, the main form is small-scale cross-border trade with simple characteristics and levels, known as minor import and export, which must also be under unified state management regarding import and export regulations.

Only small traders with capital below the legally defined limit set forth in Decree No. 211 HĐBT dated July 23, 1991 of the Council of Ministers and who are permanent residents in the border area can participate in minor border trade."

Article 1. Decision No. 115/1992/HDBT dated April 9, 1992 of the Council of Ministers on export tax and border trade import tax stipulates:

"1. Goods permitted to be imported or exported through border gates in accordance with regulations are subject to border trade import tax and export tax as prescribed in this Decision.
2. All entities engaged in importing or exporting goods through border trade as provided for in Clause 1 of this Article are required to pay taxes in accordance with this Decision." According to the above provisions, only residents in border areas are allowed to import through border trade and must declare and pay border trade import tax to the customs office at the border gate when importing. According to Article 1 of the Value Added Tax Law; Article 1 of the Income Tax Law, individuals and businesses engaged in border trade imports and exports are subject to value added tax and income tax, and must register for tax payment, comply with accounting systems, and issue invoices and receipts when buying and selling goods. Based on these provisions, the Ministry of Finance guides the documentation system for goods imported through border trade as follows:

1. For goods imported through border trade for persons directly permitted to import and transport into the interior, the following documents must be available: - Declaration form for goods imported through border trade. - Receipt for border trade import tax.

2. When a person importing through border trade sells imported goods, they must issue a sales invoice to the buyer. If the Customs has issued a receipt for border trade import tax for each individual item, then the receipt for border trade import tax (copy 3 given to the buyer) must also be provided.

3. For organizations and individuals engaged in purchasing goods imported through border trade:

a. Organizations and individuals conducting business with fixed locations in border districts who purchase imported goods for resale must have a sales invoice from the seller. When selling goods, they must issue a sales invoice to the buyer. If the fixed-location businessperson is also the direct importer, they must provide accompanying documents as specified in Point 1 of Section A, Part III above.

b. Organizations and individuals from within the country purchasing goods imported through border trade and transporting them out of the border district must have:

- Sales invoice from the seller.

- Receipt for border trade import tax (copy 3 given to the buyer) if it is a type of goods for which the Customs issues a receipt for border trade import tax for each individual item.

- List of purchases of goods imported through border trade (according to attached Form No. 2) confirmed by the Border District Tax Office where the purchase was made. In addition, specific entities must also have the following documents:

+ For non-state economic establishments, they must have a purchase record book. Purchased goods must be recorded in the purchase record book, matching the list.

+ Business establishments engaged in wholesale trading must have a receipt for payment of turnover tax and income tax at the place of shipment.

+ State-owned economic establishments do not need to maintain a purchase record book and do not need to pay turnover tax and income tax when transporting goods. However, to distinguish them, state-owned economic establishments must have a declaration form for tax registration, either original or photocopied and certified.

B. FOR OTHER IMPORTED GOODS

1. Goods imported through formal channels. Organizations authorized by competent state agencies to import must accompany the declaration form for imported goods, which has been inspected and confirmed by the Customs, when transporting goods from the port into the interior. If a large consignment is transported in multiple shipments, the Customs should certify each shipment's declaration form for imported goods.

2. Goods imported as gifts or presents must be accompanied by a declaration form for imported goods, which has been inspected and confirmed by the Customs, when transporting from the port into the interior. If the value of the consignment exceeds the tax-exempt limit, a receipt for import tax (or a decision on exemption from import tax by the Ministry of Finance) and a receipt for income tax (if the recipient is an individual) must also be provided.

3. Officials, workers, and students returning from abroad with goods exempted from tax must have a declaration form for imported goods, which has been inspected and confirmed by the Customs. If the value of the consignment exceeds the tax-exempt standard, a receipt for import tax must also be provided.

C. FOR IMPORTED GOODS IN CIRCULATION ON THE MARKET

ON THE MARKET

1. Organizations and individuals engaged in importing goods must issue a sales invoice or a combined sales invoice and warehouse dispatch note to the buyer when selling goods, to serve as proof of legitimate origin of the imported consignment for inspection and control authorities.

2. Organizations and individuals engaged in importing goods must follow the documentation system applicable to domestically produced industrial products as specified in Point A of Section II of this Circular when purchasing and transporting imported goods for sale, or reallocating goods among branches, stores, warehouses, etc. Organizations and individuals engaged in importing goods that comply with the documentation system as prescribed in this Circular will be facilitated in their business operations and transportation of goods. Inspection forces shall not cause inconvenience or affect the circulation of goods by enterprises.

IV. HANDLING VIOLATIONS AND SETTLING COMPLAINTS

Violations will be handled as follows:
1. Cases of transporting goods without a sales invoice, combined sales invoice and warehouse dispatch note, or internal transportation invoice must pay turnover tax and income tax according to the regime for wholesale trading establishments. Additionally, they may be penalized under Point 1a of Article 19 of the Value Added Tax Law. If the goods are subject to special consumption tax, the special consumption tax will be back-charged, and they may also be penalized under Points 1a and 1b of Article 20 of the Special Consumption Tax Law.

A. FOR DOMESTICALLY PRODUCED GOODS

2. Cases of purchasing agricultural, forestry, and marine products directly from farmers and fishermen without a list of purchases of forestry and marine products must pay turnover tax and income tax according to the regime for wholesale trading establishments.

2. In cases where agricultural products, forestry products, and seafood are purchased directly from farmers and fishermen, if there is no purchase list for forestry products and seafood, they must still pay turnover tax and income tax according to the regulations applicable to trading businesses.

3/ Non-state economic bases without purchase books must pay turnover tax and income tax according to the regulations for wholesale traders, and in addition, they shall be fined from one to three times the amount of tax due.

4/ Wholesale traders who do not have receipts for paying turnover tax and income tax at the distribution stage must pay turnover tax and income tax according to the regulations for wholesale traders, and in addition, they shall be fined from one to three times the amount of tax due. If processed according to the above provisions, organizations and individuals that continue to commit violations may be held criminally responsible.

B. FOR IMPORTED GOODS

1/ Organizations and individuals importing goods and transporting them from border gates into the domestic market without sufficient documents as prescribed shall be considered smuggled goods and confiscated. Or they will be subject to back payment of import tax once and depending on the level of violation, they may also be fined from two to five times the import tax (Clause 3, Article 17 of Decree No. 54/CP dated August 22, 1993).

2/ Organizations and individuals engaged in transporting imported goods within the domestic market without sales invoices (if purchased goods) or warehouse release invoices combined with internal transportation (if internally transferred goods) shall also be considered smuggled goods and confiscated. Or they will be subject to back payment of import tax once and depending on the level of violation, they may also be fined from two to five times the import tax.

3/ Organizations and individuals engaged in transporting small-scale imported goods from border districts into the domestic market lacking only purchase lists shall be administratively penalized according to Article 1 of Decree No. 01/CP dated October 18, 1992 of the Council of Ministers regarding administrative penalties in the field of taxation.

4/ State-owned economic bases if lacking tax registration, non-state economic bases with fixed business lacking purchase books, in addition to having to pay turnover tax and income tax according to the regulations for wholesale traders, shall also be fined from one to three times the tax.

5/ Wholesale traders who do not have receipts for paying turnover tax and income tax at the distribution stage shall be subject to back payment of taxes and fined from one to three times the tax.

V. IMPLEMENTATION

1/ Tax authorities when handling violations concerning document systems for goods circulating in the market must use tax receipts, payment receipts, and deposit the entire amount into the temporary holding account of the Finance Department.

Other agencies, upon discovering violations concerning document systems, if they need to handle tax issues, shall transfer the case file to the nearest tax authority for processing.

2/ Each time an inspection is conducted, the inspector must record the date and time of the inspection, sign, and stamp the inspected documents.

3/ Organizations and individuals who improperly handle causing loss to the State budget or damage to the owner of the goods must compensate for the damage. In addition, depending on the degree of violation, they may also be subject to disciplinary action or criminal prosecution.

This Circular replaces Circulars No. 61 TC/TCT dated December 10, 1990, Circular No. 59 TC/TCT dated October 15, 1992, and other documents issued by the Ministry of Finance that conflict with this Circular.

This Circular takes effect from October 20, 1994. Violations concerning document systems for goods circulating in the market before October 20, 1994, shall still be handled according to current regulations./.