CIRCULAR

AMENDMENTS TO CIRCULAR NO. 72/2014/TT-BTC DATED MAY 30, 2014 ON REFUND OF VALUE-ADDED TAX ON GOODS CARRIED BY FOREIGNERS AND OVERSEAS VIETNAMESE UPON THEIR EXIT FROM VIETNAM

Pursuant to the Law on value-added tax dated June 03, 2008; Law on amendments to certain articles of the Law on value-added tax dated June 19, 2013;

Pursuant to the Law on amendments to certain articles of the Law on value-added tax, the Law on excise tax and the Law on tax administration dated April 06, 2016;

Pursuant to the Law on tax administration dated June 13, 2019;

Pursuant to the Government’s Decree No. 209/2013/ND-CP dated December 18, 2013 elaborating and providing guidance on the Law on value-added tax;

Pursuant to the Government’s Decree No. 100/2016/ND-CP dated July 01, 2016 elaborating and providing guidance on the Law on amendments to certain articles of the Law on value-added tax, the Law on excise tax and the Law on tax administration;

Pursuant to the Government’s Decree No. 146/2017/ND-CP dated December 15, 2017 providing amendments to the Government’s Decree No. 100/2016/ND-CP dated July 01, 2016 and the Government’s Decree No. 12/2015/ND-CP dated February 12, 2015;

Pursuant to the Government’s Decree No. 87/2017/ND-CP dated July 26, 2017 defining functions, tasks, powers and organizational structure of the Ministry of Finance;

At the request of the Director General of the General Department of Customs,

The Minister of Finance promulgates a Circular providing amendments to Circular No. 72/2014/TT-BTC dated May 30, 2014 on refund of value-added tax on goods carried by foreigners and overseas Vietnamese upon their exit from Vietnam.

Article 1. Amendments to Circular No. 72/2014/TT-BTC dated May 30, 2014 on refund of value-added tax on goods carried by foreigners and overseas Vietnamese upon their exit from Vietnam

1. Article 3 is amended as follows:

 “Article 3. Rules for carrying out customs procedures, customs supervision, and tax administration

The physical inspection of goods, customs supervision and tax administration in respect of refund of VAT to foreigners shall be carried out in accordance with the provisions of Government's Decree No. 08/2015/ND-CP dated January 21, 2015 and Government's Decree No. 59/2018/ND-CP dated April 20, 2018 elaborating and providing measures for implementation of the Law on customs regarding customs procedures, customs inspection, supervision and control; Circular No. 38/2015/TT-BTC dated May 23, 2015 and Circular No. 39/2018/TT-BTC dated April 20, 2018 of the Ministry of Finance prescribing customs procedures, customs inspection and supervision, import and export duties, and tax administration in respect of imports and exports; the Law on tax administration No. 38/2019/QH14 dated June 13, 2019 and guiding documents.”

2. Article 4a is added as follows:

 “Article 4a. System for management of VAT refunds to foreigners and access method

1. The System for management of VAT refunds to foreigners (hereinafter referred to as “VAT refund system”) is an integrated system developed, managed and operated by the General Department of Customs in order to serve the retention and exchange of information on the refund of VAT to foreigners between regulatory authorities, organizations and individuals prescribed in this Circular.

2. Entities granted the right to access and exchange information through the VAT refund system:

a) Customs authorities;

b) Tax authorities;

c) Commercial banks approved as VAT refund agents;

d) Enterprises certified by tax authorities as retailers of VAT-refunded goods to foreigners.

3. Access to and information exchange through the VAT refund system:

a) The entities prescribed in Point a, Point c and Point d Clause 2 of this Article access the VAT refund system using user accounts provided by customs authorities.

b) Tax authorities shall provide information on certified retailers of VAT-refunded goods through the VAT refund system in accordance with the provisions in Clause 2 Article 9 of this Circular.

c) Immediately after receiving information on certified retailers of VAT-refunded goods provided by tax authorities through the VAT refund system, customs authorities (General Department of Customs) shall send user accounts and passwords for accessing the VAT refund system to registered emails of retailers.

d) Retailers of VAT-refunded goods shall access the VAT refund system and change passwords of their user accounts.

dd) Access to and information exchange through the VAT refund system must be carried out intra vires and by using digital signatures in accordance with regulations of the Law on e-transactions.”

3. Clause 2, Clause 6, Clause 7 and Clause 8 Article 6 are amended as follows:

 “2. Carry out registration of the sale of VAT-refunded goods at their registered addresses and assume legal responsibility for such registration. Any modification or termination of registered sale of VAT-refunded goods must be carried out in accordance with the provisions in Article 14 of this Circular.

6. Based on information in the foreigner’s unexpired passport or entry and exit documents and the sold goods, the retailer shall make the VAT invoice cum tax refund declaration, using the form in Appendix 3 enclosed herewith, for the goods eligible for VAT refund as prescribed in Article 11 of this Circular on the VAT refund system or its software system which is connected to the VAT refund system, digitally sign the VAT invoice cum tax refund declaration, send information about the VAT invoice cum tax refund declaration as prescribed in Section II.1 Appendix 10 enclosed herewith to customs authorities, print and give the VAT invoice to the foreigner. The printed invoice shall be valid as the electronic one.

In the case of failure of the VAT refund system, the retailer shall make the VAT invoice cum tax refund declaration according to the form in Appendix 3 enclosed herewith, sign, stamp and give it to the foreigner. The printed invoice shall be used as the basis for the customs authority to check and examine the goods.

Immediately when the VAT refund system works again, the retailer shall update it with information on the issued paper invoice in the same manner as a VAT invoice cum tax refund declaration made on the VAT refund system. The updated VAT invoice cum tax refund declaration must have the same number, reference number and contents as those of the paper invoice.

7. Print, issue, manage and use electronic VAT invoice cum tax refund declaration according to Clause 1 Article 18 of this Circular.

8. Be provided with user accounts for accessing and using the VAT refund system as prescribed in Article 4a of this Circular.”

4. Clause 9 Article 7 is amended as follows:

 “9. Be provided with user accounts for accessing and using the VAT refund system as prescribed in Article 4a of this Circular.”

5. Clause 4, Clause 5 and Clause 7 Article 8 are amended and Clause 7a is added to Article 8 as follows:

 “4. General Department of Customs shall receive and transfer applications for approval as VAT refund agents submitted by commercial banks to the Ministry of Finance for selection as prescribed in Article 15 of this Circular; receive and transfer applications from provincial People's Committees to the Ministry of Finance for selection of international airports and seaports accepting foreigners’ claims for VAT refund in a manner ensuring economic efficiency and meeting management requirements.

5. Update the VAT refund system with the information prescribed in Section II.2 Appendix 10 enclosed herewith.

7. Develop, manage, operate and use the VAT refund system according to Article 4a of this Circular. In the case of failure of the VAT refund system, customs authorities shall publish notification thereof according to the form in Appendix 11 enclosed herewith on the customs information portal (www.customs.gov.vn).

7a. Within the same working day or not later than the next working day, customs authorities shall give written notification to the Department of Taxation in charge of managing retailers of VAT-refunded goods in the following cases:

a) The retailer does not make the VAT invoice cum tax refund declaration according to the form in Appendix 3 enclosed herewith on the VAT refund system or fails to transmit the complete VAT invoice cum tax refund declaration to the VAT refund system, except cases of the VAT refund system failure as prescribed in Clause 6 Article 6 of this Circular;

b) The retailer makes a VAT invoice cum tax refund declaration which does not contain adequate and accurate information as prescribed in Appendix 3 enclosed herewith or whose information does not match with the actual conditions of goods;

c) The retailer violates any regulations on VAT refund laid down in this Circular.”

6. Clause 2 and Clause 8 Article 9 are amended and Clause 2a is added to Article 9 as follows:

 “2. Receive applications and select qualified retailers according to Article 13 of this Circular. Publish the list of certified retailers of VAT-refunded goods on the websites of General Department of Taxation and of the provincial Department of Taxation that certifies the retailer of VAT-refunded goods within the same working day or not later than the beginning of the working day following the day on which the written certification of retailer of VAT-refunded goods is made as prescribed in Article 13 of this Circular; digitally sign and transmit information on certified retailers of VAT-refunded goods as prescribed in Section II.4 of Appendix 10 enclosed herewith to the VAT refund system.

2a. Immediately after receiving information on retailers of VAT-refunded goods from customs authorities as prescribed in Clause 7 Article 8 of this Circular, tax authorities shall check the received information and carry out following processing steps as prescribed.

In cases where a retailer does not make the VAT invoice cum tax refund declaration according to the form in Appendix 3 enclosed herewith on the VAT refund system or fails to transmit the issued VAT invoice cum tax refund declaration to the VAT refund system, tax authorities shall, based on information provided by customs authorities, make violation records. Where the retailer repeats the violation of failure to make VAT invoice according to the form in Appendix 3 enclosed herewith or failure to transmit the issued VAT invoice cum tax refund declaration to the VAT refund system, the tax authority shall impose penalties for administrative violations against regulations on taxation and invoice (if any) and take actions against the violations in accordance with Clause 3 Article 14 of this Circular.

8. Access and make connections to the VAT refund system as prescribed in Article 4a of this Circular.”

7. Clause 2 Article 10 is amended as follows:

 “2. On the monthly and annual basis, provincial branches of the State Treasury shall compare and certify accounting reports on VAT refunds with tax authorities of the same level as prescribed.”

8. Clause 1 and Clause 5 Article 11 are amended as follows:

 “1. Goods are not included in the List of goods banned from export, the list of goods to be exported according to the export license issued by the Ministry of Industry and Trade, or the list of goods put under specialized administration as prescribed in the Government's Decree No. 69/2018/ND-CP dated May 15, 2018 and its guiding documents.

5. Goods must be bought at certified retailers of VAT-refunded goods, in brand-new and full-package conditions and must be sold with the VAT invoice cum tax refund declaration issued within the maximum duration of 60 (sixty) days before the date of exit.”

9. Article 13 is amended as follows:

 “Article 13. Eligibility requirements, applications and procedures for certification as retailers of VAT-refunded goods

1. In order to be certified as a retailer of VAT-refunded goods, the enterprise is required to meet the following eligibility requirements:

a) It is duly established and operating under the Law of Vietnam, has completed the registration of sale of VAT-refunded goods as prescribed in Article 11 of this Circular at one of the following locations:

- Its headquarters;

- Its branch or store; or

- The place where its sales agent is located.

b) It complies with regulations on accounting, invoices and documents; declares and pays VAT by adopting the credit-invoice method.

c) It has a commitment to make connections to the VAT refund system as prescribed in Article 4a of this Circular.

2. Application for certification as a retailer of VAT-refunded goods:  

a) The application form for certification as a retailer of VAT-refunded goods, which is made according to the form in Appendix 1, enclosed herewith;

b) The sales agent contract signed by and between the enterprise and its sales agent (if VAT-refunded goods are sold by the sales agent): 01 copy bearing the enterprise’s “certified true copy” stamp.

3. Procedures for certification as a retailer of VAT-refunded goods:

a) The enterprise shall send an application for certification as a retailer of VAT-refunded goods to its supervisory tax authority. If an enterprise wishes to sell VAT-refunded goods at its branch or store located in a province or city different from the one where its headquarters is located, that branch or store shall send the application to its supervisory tax authority;

b) The enterprise’s supervisory tax authority shall examine and process the received application as follows:

- Request the enterprise in writing to modify its application within three (03) working days from the receipt of the application, if it is inadequate;

- Give a written response to the enterprise within 07 (seven) working days from the receipt of the adequate application, if the application is refused; or

- If the application is adequate and the enterprise meets all eligibility requirements, within 07 (seven) working days from the receipt of the adequate application, the Department of Taxation of province or city where the enterprise’s headquarters is located shall make a written certification according to the form in Appendix 2 enclosed herewith and send it to the enterprise (if the enterprise’s supervisory tax authority is a provincial Department of Taxation), or the Sub-department of Taxation shall send a written request to the Department of Taxation of province or city where the enterprise’s headquarters is located to issue a written certification of retailer of VAT-refunded goods (if the enterprise’s supervisory tax authority is a Sub-department of Taxation). Within 05 working days from the receipt of the written request from the Sub-department of Taxation, the Department of Taxation of province or city where the enterprise’s headquarters is located shall make a written certification according to the form in Appendix 2 enclosed herewith and send it to the enterprise.”

10. Clause 3 Article 14 is amended as follows:

 “3. If the retailer violates any regulations on VAT refund, the provincial Department of Taxation shall, depending on each violation and its severity, take actions against the violation. If the retailer repeats the violation of failure to make VAT invoice according to the form in Appendix 3 enclosed herewith or failure to transmit the issued VAT invoice cum tax refund declaration to the VAT refund system, in addition to the administrative penalty (if any), the provincial Department of Taxation shall consider deciding to terminate the sale of VAT-refunded goods, transmit information to the VAT refund system, and publish the same on its website and the website of General Department of Taxation.”

11. Clause 2 and Clause 3 Article 15 are amended as follows:

 “2. Procedures for approval as a VAT refund agent:

The commercial bank shall submit the following documents to the Ministry of Finance (the General Department of Customs):

a) The application for approval as a VAT refund agent, which includes information on the digital signature of the commercial bank such as number, certification authority and holder of the digital certification, date of validity, expiry date and public key;

b) The license to provide foreign exchange services issued to the commercial bank by the State Bank: 01 copy bearing the commercial bank’s “certified true copy” stamp.

3. The General Department of Customs shall receive and examine the application submitted by the commercial bank.

a) If the application is inadequate, a written request for modification of the application shall be sent to the commercial bank within three (03) working days from the receipt of the application;

b) If the application is refused, a written response shall be given to the commercial bank within 05 (five) working days from the receipt of the application;

c) If the application is adequate and the commercial bank meets all eligibility requirements, within seven (07) working days from the receipt of the application, the Ministry of Finance (General Department of Customs) shall send a written notification to the commercial bank eligible to act as a VAT refund agent and provide it with a user account for accessing the VAT refund system”.

12. Clause 1 Article 18 is amended as follows:

 “1. Retailers shall make and use VAT invoice cum tax refund declaration as prescribed in Clause 6 Article 6 of this Circular.

Printing, issuance, management and use of VAT invoice cum tax refund declaration shall comply with regulations on invoices and relevant guiding documents.”

13. Clause 2 Article 19 is amended as follows:

 “2. Customs authorities shall carry out the physical inspection of goods at the counter for examination of VAT invoice cum tax refund declaration and goods. Contents of the physical inspection:

a) Compare information on the passport or entry and exit document with those on the VAT invoice cum tax refund declaration; information on the VAT invoice cum tax refund declaration input into the VAT refund system by retailers and regulations on VAT-refunded goods as prescribed in Article 11 of this Circular;

b) Physically inspect the goods that are subject to the physical inspection according to the risk management rules.

If the actual conditions of the good do not match the description of the good on the VAT invoice cum tax refund declaration in Appendix 10 enclosed herewith or the VAT invoice cum tax refund declaration does not contain adequate information or is not available on the VAT refund system (except the case of failure of the VAT refund system), the customs authority shall verify information with the relevant retailer. If the information provided by the retailer does not match with the information about the good, and the information on the VAT invoice and passport, the customs authority shall refuse to refund VAT;

c) Record examination results and append a stamp to approve or reject VAT refunds. If the customs authority approves VAT refunds, it shall determine the good and calculate the actual amount of VAT refunds paid to the foreigner as prescribed in Article 12 of this Circular;

dd) Update the VAT refund system with the information prescribed in Section II.2 Appendix 10 enclosed herewith, and apply the digital signature.

In the case of failure of the VAT refund system, the customs authority shall append signature and stamp to approve or reject VAT refunds on the VAT invoice cum tax refund declaration.”

14. Clause 2 Article 20 is amended as follows:

 “2. The commercial bank shall:

a) Check the boarding pass to the aircraft or ship; the VAT invoice cum tax refund declaration; information on the VAT refund system about the passenger, the good, approval of VAT refunds given by the customs authority, and actual amount of VAT refund.

If the information about the passenger on the boarding pass to the aircraft or the ship does not match with those on the VAT invoice cum tax refund declaration examined and certified by the customs authority, the commercial bank shall verify the information with the customs authority. If the information provided by the customs authority does not match with the information on the boarding pass to the aircraft or the ship, the commercial bank shall reject VAT refunds and notify the customs authority of such rejection through the VAT refund system;

b) Update the VAT refund system or the commercial bank’s software system connected to the VAT refund system with number and date of the flight or trip, and other information prescribed in Section II.3 of Appendix 10 enclosed herewith, digitally sign and transmit such information to the customs authority;

c) Make payment, in cash or via international card of the foreigner, of the actual amount of VAT refunds specified on the VAT invoice cum tax refund declaration by the customs authority.

In the case of payment of VAT refunds via the foreigner’s international card, the bank shall compare information (name and card number) registered by the foreigner for receiving VAT refunds with those on the card presented by the foreigner.

In the case of failure of the VAT refund system, the commercial bank shall, based on the VAT invoice cum tax refund declaration and certification of the customs authority as prescribed in Point d Clause 2 Article 19 hereof, pay VAT refunds to the foreigner according to Clause 2 of this Article, and append signature and stamp certifying the payment on the VAT invoice cum tax refund declaration.

Immediately when the VAT refund system works again, the commercial bank shall update the VAT refund system or its software system connected to the VAT refund system with information on the VAT invoice cum tax refund declaration for which payment of VAT refunds has been made, digitally sign and transmit such information to the customs authority;

d) Return the boarding pass to the flight or ship to the foreigner;

dd) Keep electronic and paper VAT refund-related documents in accordance with applicable laws.”

15. Article 21 is amended as follows:

 “Article 21. Reimbursement of advanced VAT refunds and payment of VAT refund fees

1. Every five (5) working days, based on its actual conditions, the commercial bank shall make a request for reimbursement of advanced VAT refunds and payment of VAT refund fees on the VAT refund system, and send it to the provincial Department of Taxation where it registers and declares tax, and to the Customs Department of province or city where the payment of VAT refunds was made by the commercial bank. Such request includes:

a) The written request for reimbursement of advanced VAT refunds and payment of VAT refund fees, which is made according to the form in Appendix 5 enclosed herewith;

b) The statement of payments to be reimbursed, which is made according to the form in Appendix 6 enclosed herewith.

2. Within the maximum duration of two (02) working days from the receipt of the request from the commercial bank, based on certifications of VAT refunds electronically provided by customs authorities, the provincial Department of Taxation where the commercial bank registers and declares tax shall promulgate a decision on payment according to the form in Appendix 7 enclosed herewith, and make an order for refund of state budget revenues according to the form enclosed with the Circular No. 77/2017/TT-BTC dated July 28, 2017 of the Minister of Finance providing guidance on state budget accounting and State Treasury operations, and then send them to the commercial bank and the State Treasury's branch of the same level for transferring money to the commercial bank.

3. Based on the decision on payment and refund order issued by the provincial Department of Taxation, the State Treasury shall transfer money to the commercial bank in accordance with the Circular No. 99/2016/TT-BTC dated June 29, 2016 and the Circular No. 31/2017/TT-BTC dated April 18, 2017 of the Minister of Finance providing guidance on management of VAT refunds.

4. Statement and transfer of documents shall be carried out in accordance with Article 19 of the Circular No. 99/2016/TT-BTC dated June 29, 2016, as amended in the Circular No. 31/2017/TT-BTC dated April 18, 2017 and Clause 3 Article 59 of the Circular No. 156/2013/TT-BTC dated November 06, 2013 of the Minister of Finance.”

16. Clause 2, Clause 3 and Clause 4 Article 23 are amended as follows:

 “2. By the 20th of the month following the quarter in which tax liability arises, the retailer of VAT-refunded goods shall submit reports to its supervisory tax authority on the sale of goods to foreigners according to the form in Appendix 9 enclosed herewith and in accordance with regulations promulgated by the Director General of General Department of Taxation.

3. By the 10th of the following month, the Provincial Department of Taxation where the commercial bank or the retailer registers and declares tax shall play the leading role and cooperate with the State Treasury in comparing actual amounts of VAT refunds according to Clause 2 Article 10 of this Circular; cooperate with the Customs Department of the same level to review and compare the actual amounts of VAT refunds declared or paid by the retailer, VAT refunds and VAT refund fees reimbursed and paid to the commercial bank. In cases where figures between the relevant parties are not matched, regulatory authorities shall cooperate to find the causes and deal with that to ensure the processing of claims for VAT refund of foreigners in accordance with applicable regulations.

4. The provincial Department of Taxation where the commercial bank registers and declares tax shall prepare consolidated reports on paid amounts of VAT refunds, amounts of VAT refunds and VAT refund fees reimbursed and paid to commercial banks; Provincial Departments of Taxation shall report on the sale of VAT-refunded goods by retailers under their management to the General Department of Taxation according to regulations promulgated by the Director General of General Department of Taxation.”

17. Appendixes are amended as follows:

a) Appendix 1, Appendix 2, Appendix 3, Appendix 7 and Appendix 8 enclosed with the Circular No. 72/2014/TT-BTC are respectively replaced with Appendix 1, Appendix 2, Appendix 3, Appendix 7 and Appendix 8 enclosed herewith.

b) Appendix 10 and Appendix 11 are additionally enclosed with this Circular.

Article 2. Abrogation of regulations

The following are abrogated:
1. Clause 5 Article 10, Clause 4 Article 15, Clause 5 Article 18 of the Circular No. 72/2014/TT-BTC.

2. Appendix 4 enclosed with the Circular No. 72/2014/TT-BTC.

Article 3. Transition

1. Enterprises which have been certified as retailers of VAT-refunded goods by tax authorities before this Circular comes into force shall continue their operations and provide additional information on digital signature according to the form in Appendix 8 enclosed herewith (if they have software systems connected to the VAT refund system) or access the VAT refund system for changing passwords of their user accounts (if they print VAT invoices from the VAT refund system).

2. By June, 2020, based on information on certified retailers of VAT-refunded goods provided by tax authorities through the VAT refund system, General Department of Customs shall send user accounts and passwords for accessing the VAT refund system to registered emails of retailers.

3. When the Decree providing guidance on electronic invoices as prescribed in the Law on tax administration No. 38/2019/QH14 comes into force, VAT invoice cum tax refund declaration shall be issued in accordance with this Decree and its guiding documents.

Article 4. Effect

1. This Circular comes into force from July 01, 2020.

2. During implementation of this Circular, if relevant documents referred to in this Circular are amended or replaced, the new ones shall apply./.

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