CUSTOMS PROCEDURE

Question:
The company implements a processing contract to produce Leather goods, and at the end of the production process, we have SCRAP, SCRAP (Trimmed leather) removed and returned to the party. outsourcing on demand. So does the company have to change the purpose of use to pay NPL import tax if it exceeds the 3% loss? and what kind of export?
Reply:
- Pursuant to Point d Clause 3 Article 64 of Circular 38/2015 / TT-BTC dated 25 March 2015 amended and supplemented in Clause 42 Article 1 of Circular 39/2018 / TT-BTC dated April 20, 2015 of The Ministry of Finance stipulates:
"Article 64. Customs procedures for dealing with surplus raw materials and supplies; waste, scrap and defective products; rented or borrowed machinery and equipment
3. Customs procedures
b) Procedures for returning raw materials, supplies, scrap and defective products to foreign countries during the performance of the processing contract or when the processing contract is completed or expires is the same as the procedure for returning the goods to the country. In addition to the provisions of Article 48 of Decree No. 08/2015 / ND-CP and Clause 21, Article 1 of Decree No. 59/2018 / ND-CP.
Procedures for returning temporarily imported machinery and equipment to foreign countries during the performance of a processing contract or when the processing contract is completed or expires is the same as the procedure for returning to a foreign country as prescribed in Article 50 Decree No. 08/2015 / ND-CP amended and supplemented in Clause 23 Article 1 of Decree No. 59/2018 / ND-CP; ”
- Pursuant to Article 48 of Decree No. 08/2015 / ND-CP and Clause 21 Article 1 of Decree No. 59/2018 / ND-CP
"Article 48. Customs procedures, customs supervision for imported goods must be re-exported
1. Forms of re-export of goods for which customs procedures have been completed include:
a) Re-export to pay to customers;
b) Re-export to a third country or re-export to non-tariff areas.
2. Customs dossier:
a) The declaration of exported goods;
b) Written acceptance of the goods owner to accept the goods back (if the export goods are returned to the owner of the shipment): submit 01 copy;
c) Decision on forced re-export of the competent authority (if any): 01 copy.
3. Customs procedures shall comply with the provisions of Section 5 of this Chapter (except import permits, written notices of specialized examination results) ... "
- Based on the instruction of using VNACCS code table in Official Letter No. 2765 / TCHQ-GSQL dated April 1, 2015:
Type B13 - Export of imported goods
Use in case of: Imported goods of various types must be re-exported (including re-export to return to foreign customers; exported to third countries or exported into non-tariff areas); Goods which are excess materials of processing contracts returned to the overseas processor; Goods which are machinery and equipment of export-processing enterprises, machinery and equipment are exempt from liquidation in the form of sale to foreign countries.
2. / Regarding tax policies:
Pursuant to Clause 49 Article 1 of Circular 39/2018 / TT-BTC dated 20/4/2018 of the Ministry of Finance amending and supplementing Article No. 71 of Circular No. 38/2015 / TT-BTC dated March 25, 2018 In 2015 of the Ministry of Finance, discarded materials and faulty products collected during the manufacture of export goods, when being sold or consumed, are exempt from import tax but must declare and pay value-added tax and special consumption tax. Particularly, environmental protection tax (if any). Therefore, when re-exporting the above mentioned scraps and defective products, the company is not required to pay import tax when declaring the procedures.

Request the company to refer to the above provisions for implementation. In case of any problems, please contact the Customs Branch where the declaration is registered for specific instructions.