In April 2019, the Ministry of Finance issued Circular 18/2019 / TT-BTC (“Circular 18”) abolishing Circular No. 134/2014 / TT-BTC dated September 12, 2014 (“Circular 134”) to guide the procedure of extending the time limit for tax payment and VAT refund for imported machinery and equipment to create fixed assets of investment projects. The new circular will take effect from May 20, 2019.
Noticeable changes in Circular 18 are as follows:
- Previously, Circular 134 was issued to enforce the orientation of Resolution 63 / NQ-CP dated August 25, 2014, of the Government on several measures to solve difficulties for businesses (“Resolution 63”). Specifically, Circular 134 guides procedures for extending tax payment time and VAT refund for imported machinery and equipment to create fixed assets of investment projects. This provision assists newly established businesses and is still in the investment phase or an active business with new investment projects or extended investment projects that are financially difficult to shorten the time of entry.
- However, according to the new Resolution 150 / NQ-CP issued by the Government on December 13, 2018, on suspending the implementation of the solution to extend tax payment and VAT refund under the provisions of Resolution 63, the Ministry of Finance has issued Circular 18 to abolish all contents of Circular 134.
- Accordingly, from May 20, 2019, the investment project to import machinery and equipment valued at 100 billion VND or more can no longer be extended for VAT payment within a period of 60 days from the expiry date according to regulations and give priority to refund VAT (refund before, check later).
- For the application for extension of VAT payment or VAT refund according to the provisions of Circular No. 134 which the enterprise has submitted to the customs office or tax agency before the effective date of Circular 18 (ie, May 20, 2019), the tax agency shall continue to settle under the provisions of Circular 134.