News

The Government of Vietnam has issued Decree No. 26/2023/ND-CP, which outlines the new Export Tariff, Preferential Import Tariff, List of Goods, and specific tax rates such as absolute tax, mixed tax, and out-of-quota import tax.

This Decree is accompanied by four annexes:

1. Export Tariff by List of Taxable Items
2. Preferential Import Tariff by List of Taxable Items
3. List of Goods and Absolute/Mixed Tax Rates for used passenger vehicles with up to 15 seats
4. List of Goods and Out-of-Quota Import Tax Rates for items subject to quota restrictions

Import Tax on Used Vehicles

For used passenger vehicles, the Decree provides specific provisions:

• Vehicles with up to 9 seats and an engine capacity of ≤1,000cc (classified under group 87.03) are subject to absolute tax rates as stated in Annex III of the Decree.
• Vehicles with up to 9 seats and an engine capacity >1,000cc, as well as vehicles with 10 to 15 seats, fall under mixed tax rates specified in Annex III.
• Vehicles with 16 seats or more, along with other vehicles (e.g., cargo vehicles with a total design weight ≤5 tons), are subject to a 150% preferential import tax rate, excluding certain specialized vehicles like refrigerated trucks, waste collection vehicles, cement tankers, and armored cars.
• Other used vehicles under groups 87.02, 87.03, and 87.04 are taxed at 1.5 times the preferential import tax rate applicable to their new counterparts.

Preferential Import Tariff by List of Taxable Items

Annex II of the Decree specifies the Preferential Import Tariff:

• Section I: Import tax rates for 97 chapters of goods under Vietnam’s export-import nomenclature, including item descriptions, codes (8-digit), and applicable tax rates.
• Section II: List and tax rates for goods under Chapter 98, covering classifications, conditions, and customs procedures for applying preferential import tax rates.

Goods qualifying under Chapter 98 may also apply special preferential tax rates as stipulated in separate tariffs. When declaring customs, importers must indicate the corresponding codes from Annex II alongside Chapter 98 codes.

Tax Adjustments for Export-Import Goods (Effective July 15)

The General Department of Customs has issued guidance on implementing Decree No. 26/2023/ND-CP and Decision No. 15/2023/QD-TTg, introducing several notable changes:

• Export Tariff Adjustments:
  • Increased export tax rates for unprocessed tin items under certain codes (e.g., 7901.11.00.90) from 5% to 10%.
  • Reclassification of copper products under code 7411.10.00 into sub-categories with differentiated tax rates:
    • 0% for items ≤50mm in diameter
    • 5% for other items
  • A unified 5% export tax rate for fertilizers under groups 31.02 to 31.05, except certain codes with a 0% rate.
• Preferential Import Tariff Adjustments:
  • Reduced tax rates for petroleum products (e.g., codes 2710.12.40–2710.20.00) from 20% to as low as 0%.
  • Ethanol (codes 2207.20.11, 2207.20.19) reduced from 15% to 10%.
  • Import tax on new rubber tires for passenger and cargo vehicles reduced from 25% to 20%.
  • A fixed 50% tax rate for tobacco-related products under group 24.04, including e-cigarette nicotine products.

For imported automotive CKD kits, businesses can choose to classify and apply tax rates based on individual components or opt for CKD kit tax rates under group 98.21 as specified in the Decree.

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