Uni 16-11-2017 - Guidance on tax treatment for redundancy materials of processing contract

Official letter 14475/BTC-TCHQ dated 26 Oct 2017 guiding tax treatment for redundant scraps, defects, materials of processing contract when they are consumed in Vietnam as follows:

Before 1 Sep 2016: for redundant scraps, defects, materials imported for processing less than 3%; total imported materials, supplies, when they are sold, consumed in Vietnam without doing customs procedures to convert usage purpose but must declare to pay tax with tax authority under tax regulations.

From 1 Sep 2016 until now: for redundant scraps, defects, materials imported for processing less than 3%; total amount of each imported material in accordance with processing contract is exempted from import when they are consumed in Vietnam, but must declare to pay other taxes (if any) to customs authority.