Conditions, applications and procedures for recognition of tax-suspension warehouses in Vietnam

What is tax-suspension warehouse?

Pursuant to the provisions of the Customs Law 2014, tax-suspension warehouse means a warehouse used to store imported materials and supplies formalities serving production of exported products that have been granted customs clearance but taxes on which have not been paid.

The time limit for storing materials and supplies in tax suspension warehouses for export production is 12 months from the date of their consignment. In case of having reasonable grounds according to requirement of the production process, heads of Customs Sub-Departments in charge of tax suspension warehouses may grant an extension for the time limit. The extension must be conformable with the production cycle.

Tax suspension warehouses shall be established in workshop’s area of export production enterprises.

Conditions, applications and procedures for recognition of tax-suspension warehouses in Vietnam (Internet image) 

Conditions for recognition of tax-suspension warehouses in Vietnam

Pursuant to Article 16 of Decree 68/2016/ND-CP, an enterprise shall be recognized as a priority enterprise to be recognized as a tax-suspension warehouse if it meets the following conditions:

- Having a system of accounting books and applying information technology according to the standards of state management agencies to monitor and manage goods imported, exported, stored and stocked in warehouses;

- Located in the production facility area of the enterprise, separated from the area where raw materials and supplies are not tax-suspensed, installed a surveillance camera system that meets the data exchange standards of the enterprise. customs offices to supervise goods in and out of tax-suspension warehouses.

Enterprises producing export goods with export turnover of 40 million USD or more are recognized as tax-suspension warehouses. In addition to the above conditions, they must also satisfy the following conditions:

- Having export activities for at least 02 consecutive years or more without violating customs and tax laws;

- Comply with accounting and statistical laws;

- Make payment via bank in accordance with the law.

Applications for recognition of tax-suspension warehouses in Vietnam

Pursuant to Article 17 of Decree 68/2016/ND-CP, the applications for recognition of tax-suspension warehouses includes:

- Original copy of the written request according to Form 01 enclosed with Decree 68/2016/ND-CP;

- Copy of diagram of tax-suspension warehousing area.

Procedures for recognition of tax-suspension warehouses in Vietnam

- Enterprises may submit applications for certificates of eligibility for trading in duty-free goods (herein ‘the certificate’) in person or via electronic data processing system of customs agencies to the General Department of Customs.

- Within 10 working days since receipt of applications from enterprises, the General Department of Customs shall carry out inspection of the application, duty-free shops, warehouses.

- Within five working days since completion of the inspection, the Director of the General Department of Customs shall issue the certificate or give notifications to the enterprise if the application fails to meet requirements as prescribed.

- In case the application is inadequate, within 05 working days from the day on which the application is received from the enterprise, General Department of Customs shall send a document requesting the enterprise to supplement the application.

If the enterprise fails to respond in writing within 30 days from the day on which the request is sent, General Department of Customs shall be entitled to invalidate the application.

Pursuant to: Article 18 of Decree 68/2016/ND-CP

Mai Thanh Loi

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