UNIVERSITY OF ECONOMICS & LAW

SCHOOL OF FINANCE & BANKING

EXCISE TAX

Tax regulations in Vietnam

Taxation
VIETNAM TAXES

Excise Tax 2
VIETNAM TAXES

IMPORT TAX EXCISE TAX VAT

Price before Price before Price before

import tax excise tax VAT tax

20% 30% 10%

Example: 100 USD 120 USD 156 USD 171.6 USD

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EXCISE TAX FEATURES
• Is an indirect tax. Apply to several luxury goods and services
• Imposed on importing and domestic production
• Tax rates are usually high
• Objectives:
• Regulating income
• Regulating and guiding consumers
• Generate revenue for the government
• Protect few industries
• Taxpayers: include producers and importers of goods and providers of services which are subject
to excise tax.

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DOCUMENTS
• Excise tax law 27/2008/QH12 issued on 14/11/2015,
• Decree No. 108/2015/NĐ-CP,
• Circular No. 195/2015/TT-BTC

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TAXABLE OBJECTS (10 goods & 6 services)
Goods:
1. Cigarettes, cigars and other tobacco 5. Two- and three-wheeled motorcycles of a
preparations used for smoking, inhaling, cylinder capacity of over 125 cm3;
chewing, sniffing or keeping in mouth; 6. Aircraft and yachts;
2. Liquor; 7. Gasoline;
3. Beer; 8. Air-conditioners of 90,000 BTU or less;
4. Under-24 seat cars, including cars for both 9. Playing cards;
passenger and cargo transportation with 10. Votive gilt papers and votive objects.
two or more rows of seats and fixed
partitions between passenger holds and
cargo holds;

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TAXABLE OBJECTS (10 goods & 6 services)
Services:
1. Dance halls;
2. Massage parlors and karaoke bars;
3. Casinos; prize-winning video games, including jackpot and slot games and games on similar
machines;
4. Betting;
5. Golf business, including the sale of membership cards and golf playing tickets;
6. Lottery business.

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NOTE:
• For aircraft, yachts: use for civil purposes.
• For gasoline of all kinds, naphtha, reformade components and other components for mixing
gasoline: not including which are directly imported or directly purchased from manufacturers.
• For votive gilt papers and votive objects: not including children's toys, teaching aids and
decorations.
• For betting: including sports betting, entertainment and other betting forms prescribed by law
• Subject to special consumption tax on goods are finished goods products, excluding components
for assembling these goods.

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NON-TAXABLE SUJECTS
1. Imported goods, including :
a) Goods as humanitarian aid or non-refundable aid; gifts for state agencies, political organizations,
socio-political organizations, socio-political-professional organizations, social organizations,
socio-professional organizations or people’s armed forces units; and donations or gifts for individuals
in Vietnam within the quotas prescribed by the Government;
b) Gifts given to individuals in Vietnam according to the norms;
c) Goods temporarily imported for re-export and temporarily exported for re-import which are not
subject to excise tax within the time limit specified in the law of excise tax;
d) Goods transited or transported via Vietnamese border gates or borders, and goods transported to and
from border gates under the Government’s regulations;

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NON-TAXABLE SUJECTS
e) Goods temporarily imported for participation in fairs and exhibitions, if re-exported within the time
limit specified in the law of excise tax. Upon the expiration of a fair or exhibition, if organizations or
individuals do not re-export the temporarily imported goods, they must declare and pay excise tax; If
organizations and individuals do not declare but are checked and discovered, apart from the collection
of excise tax, they shall be fined according to the provisions of law;
f) Personal belongings of foreign organizations and individuals within diplomatic immunity quotas;
personal belongings within duty-free luggage quotas; and goods imported for duty-free sale under law;
g) Luggage within free-duty quotas of Vietnamese or foreigners across Vietnam borders.
h) Imported goods to sell at free-duty zones as prescribed by law

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NON-TAXABLE SUJECTS
2. Transited goods through Vietnam's border gates or borders:
a) Goods are transported from the exporting country to the importing country via Vietnam's border
gates but do not carry out procedures for importing into Vietnam and do not carry out procedures for
export out of Vietnam;
b) Goods are transported from the exporting country to the importing country via Vietnam's border
gates to the bonded warehouse but do not carry out procedures for importing into Vietnam and do
not carry out procedures for export out of Vietnam;
c) Transited goods through Vietnam's border gates or borders based on an agreement signed between
the Vietnam Government or authorized agencies and representatives and the foreign Government.
d) Goods transported from an exporting country to an importing country without going through
Vietnam's border gates

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NON-TAXABLE SUJECTS
3. Aircraft and yachts used for commercial transportation of cargos, passengers and tourists;
4. Ambulances; prison vans; hearses; cars designed with both seats and standing places for
transporting 24 or more people; cars running in recreation, entertainment and spoils areas
which neither are registered for circulation nor move on roads;
5. Air conditioners with capacity lower than 90,000 BTU according to the manufacturer's design for
installation only on means of transport, including automobiles, train carriages, ships, boats and
aircraft.
6. Goods which are directly exported by producers or processors, or which are sold or entrusted by
these producers or processors to other business establishments for export, except under-24
seat cars sold for processing enterprises.

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NON-TAXABLE SUJECTS
7. Goods imported from abroad into non-tariff areas, goods sold from the inland into non-tariff
areas for use only in non-tariff areas, and goods traded between non-tariff areas, except
under-24 seat cars.

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TAX BASES
• Excise tax bases include the taxed price of a taxable goods or service and the tax rate. The
payable excise tax amount is the excise taxed price multiplied by the excise tax rate.

EXCISE TAX PAYABLE

= EXCISE TAXABLE × EXCISE TAX
PRICE RATE

• Excise taxable price:

1. Goods:
• Domestically produce
• Imported
2. Domestically produce service

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TAXABLE PRICE – Domestically produce goods
• Excise tax calculation price is the price without VAT, environmental protection tax (if any),
without excise tax and not excluding the packaging value.

PRICE (Not include _ ENVIRONMENT

EXCISE TAXABLE = VAT) PROTECTION TAX
PRICE 1 + EXCISE TAX
RATE

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NOTE:
• For bottled beer: the manufacturer and the customers must make the final settlement of the
deposit for the bottles quarterly, the deposit equivalent to the lost bottles is included to the
excise tax calculation.
• In case the importers of products subjected to excise tax (except cars under 24 seats &
gasoline products), the manufacturers of the products subjected to excise tax (except cars
under 24 seats) sell these products to commercial business establishments, the price used for
excise tax calculation is the price sold by the importers, manufacturers but not less than 7%
comparing to the average prices sold by commercial business establishments of the same
product within 1 month.

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NOTE:
• For imported under 24 seats cars, the price uses for excise tax calculation is the price sold by the
importers but not less 105% of the cost of good sold. The cost of good sold is equal to import tax
price plus (+) import tax paid (if any) plus (+) excise tax paid at the import stage. Otherwise, the
price uses for excise tax calculation will be set by the tax agency in accordance with the tax law.
• For manufacturing and assembling cars under 24 seats establishments: the price uses for excise
tax calculation is the sale price of the manufacturers, but not less than 7% comparing to the
average prices sold by commercial establishments of the same products within 1 month.

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TAXABLE PRICE – Imported goods
• The excise taxable price is equal to the import taxable price plus the import tax payable amount

EXCISE TAXABLE = IMPORT TAXABLE + IMPORT TAX

PRICE PRICE PAYABLE

• Apply for: Imported goods.

• Note: Excise taxable price includes packaging values.

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NOTE
• For processed goods, it is the taxed price of the goods sold by processing-ordering
establishment or the selling price of the product of the same or similar kind at the same time
with the time of goods sale;
• For goods sold on installment or deferred payment, it is the one-off selling price of such goods,
exclusive of the installment or deferred payment interest;
• For goods and services used for barter, internal consumption or donation, it is the excise taxed
price of the goods or service of the same or similar kind at the time of barter, internal
consumption or donation;

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NOTE
• For goods produced in the form of business cooperation between a production establishment
and an establishment that uses or owns a brand (trademark) of goods and technologies, the
price used as a basis for calculation of excise tax is the price sold exclude VAT and environmental
protection tax (if any) of the establishment using or owning the brand of goods or technology of
manufacture. In cases where the establishment produces under transferred license to a branch
or representative of a foreign company in Vietnam to sell its products, the price for excise tax
calculation is the selling price of the branch, representative of foreign company in Vietnam;
• Exporting business purchases goods subject to excise tax from other production establishment
for export; however, they do not export these goods but sold domestically, the price for excise
tax calculation in this case is the same as similarly domestic goods sold.

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TAX BASES - SERVICE
• For services: the taxable price uses for excise tax calculation is the service price sold by the
business establishment without VAT and excise tax.
• For casinos & prize-winning video games: the price uses for excise tax calculation is the revenue
from casinos & prize-winning video games deducted to the prize for winning customers, which is
the collected amount (before VAT) due to exchange for customers before playing at the money
exchange counters or tables playing machine minus the exchange amount returned to the
customer.
• For betting: the price uses for excise tax calculation is the revenue from ticket sales minus (-) the
bonuses paid to customers (before VAT), excluding ticket sales for entertainment events
associated with betting activities.

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TAX BASES - SERVICE
• For golf business: the price uses for excise tax calculation is the revenue of selling membership
cards, golf playing tickets, practice tickets, maintenance, car rental (buggy) and housekeeper
services while playing golf (caddy), deposit (if any) and other golf-related expenses paid by
golfers and members paid to the golf business establishment. In case the deposit is returned to
the depositor, the establishment will be refunded the tax amount already paid by deducting
from the payable amount of the next period, if not deducted, the establishment will be
refunded as prescribed. In case a golf business also provides other goods or services not subject
to excise tax such as hotels, catering, merchandise, or games; these goods and services is not
subject to excise taxes.

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TAX BASES - SERVICE
• For dance halls, massage parlors & karaoke bars, the price uses for excise tax calculation is the
revenue (before VAT) of all business activities in dance halls, massage parlors & karaoke bars,
including catering, other related services (bath, sauna …)
• For lottery business, price uses for excise tax calculation is the revenue (before VAT) from selling
of all lottery ticket kinds allowed by law.

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EXCISE TAX REFUND
• Goods temporarily imported for re-export, applicable only to actually exported goods;
• Goods which are raw materials imported for export production and processing, applicable only
to actually exported goods;
• Finalization of overpaid tax amounts upon merger, consolidation, separation, split-up,
dissolution, bankruptcy, ownership change, enterprise transformation or operation termination;
• Upon issuance of tax refund decisions by competent agencies under law. and cases of excise tax
refund under treaties to which the Socialist Republic of Vietnam is a contracting party.

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NOTE
• In case the business establishment provides different kinds of goods & services with different
excise tax rates, then the business establishment must declare and pay the excise tax according
to each tax rate prescribed for each type of goods or service; If the establishments cannot
determined the tax rates for the products, they must calculate and pay tax at the highest tax
rate of goods or services that they have produced or traded.

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EXCISE TAX DEDUCTION
• Taxpayers that produce excise taxable goods from raw materials for which excise tax has been
paid and that can produce lawful documents on tax payment may have the tax amounts paid for
raw materials deducted upon the determination of payable excise tax amounts at the stage of
production.
• If the taxpayer produces gasoline, oil and petrochemical solvents at the same time with
materials subject to excise tax, then the excise paid for raw materials is deducted when
determine the excise tax amount to be paid. The deductible excise tax amount corresponds to
the excise tax amount paid for the materials used to manufacture goods sold.

EXCISE TAX PAID FOR RAW MATERIALS

= EXCISE TAXABLE × EXCISE TAX
PRICE RATE

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EXCISE TAX REDUCTION
• The amount of excise tax deduction is corresponding to the amount of excise tax paid for raw
materials which is used to produce the actual sold out goods

Excise tax paid for raw

Excise tax payable for _
Total excise tax = finished goods sold out in
materials used to produce
payable in the period sold out goods in the
the period
period

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EXCISE TAX REDUCTION
• Taxpayers that produce excise taxable goods and face difficulties caused by natural disasters or
unexpected accidents are entitled to tax reduction.
• The tax reduction level shall be determined based on the actual extent of damage caused by
natural disasters or unexpected accidents but must neither exceed 30% of the payable tax
amount in the year the damage occurs nor exceed the balance between the value of damaged
assets and the received compensation (if any).

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EXCISE TAX RATES FOR GOODS
No. Goods Tax rate (%)
1 Cigarettes, cigars and other tobacco preparations 65
2 Liquor
a) Of 20° proof or higher
- From January 1, 2010, through December 31, 2012 45
- From January 1, 2013 50
b) Of under 20° proof 25
3 Beer
- From January 1, 2010, through December 31, 2012 45
- From January 1, 2013 50
4 Under-24 seat cars
a) Passenger cars of 9 seats or fewer, except those specified at Points 4e, 4f and 4g
- Of a cylinder capacity of 2,000 cm3 or less 45
- Of a cylinder capacity of between over 2,000 cm3 and 3,000 cm3 50
- Of a cylinder capacity of over 3,000 cm3 60

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EXCISE TAX RATES FOR GOODS
No. Goods Tax rate (%)
b) Passenger cars of between 10 seats and under 16 seats, except 30
those specified at Points 4c, 4f and 4g of this Article
c) Passenger cars of between 16 seats and under 24 seats, except 15
those specified at Points 4e, 4f and 4g of this Article
d) Cars for both passenger and cargo transportation, except those 15
specified at Points 4e, 4f and 4g of this Article
e) Cars running on gasoline in combination with electricity or 70% of the tax rate for cars of
bio-fuel, with gasoline accounting for not more than 70% of the used the same kind as specified at
fuel Points 4a, 4b, 4c and 4d
50% of the tax rate for cars of
f) Cars running on bio-fuel the same kind as specified at
Points 4a, 4b, 4c and 4d

g) Electrically-operated cars 25
- Passenger cars of 9 seats or fewer 15
- Passenger cars of between 10 seats and under 16 seats 10
- Passenger cars of between 16 seats and under 24 seats 10 30
- Cars for both passenger and cargo transportation
EXCISE TAX RATES FOR GOODS
No. Goods Tax rate (%)
5 Two- and three-wheeled motorcycles of a cylinder capacity of over 125 cm3 20
6 Aircraft & yachts 30
7 Gasoline of all kinds, naphtha, reformade components and other components for 10
mixing gasoline
8 Air conditioners of 90.000 BTU or less 10
9 Playing cards 40
10 Votive gilt papers and votive objects 70

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EXCISE TAX RATES FOR SERVICES
No. Service Tax rate (%)

1 Dance halls 40

2 Massage parlors and karaoke bars 30

3 Casinos and prize-winning video games 30

4 Betting 30

5 Golf business 20

6 Lottery business 15

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