New guidelines on special sales tax

The Ministry of Finance issued Circular No 05/2012/TT-BTC on January 5, giving guidelines on special sales taxes as stipulated in Government Decree No 26/2009/ND-CP and Government Decree No 113/2011/ND-CP.

Under Circular No 05, there are seven cases in which taxable goods are not subject to special sales taxes, including (i) automobiles used for emergency medical care, hearses, or in entertainment; (ii) naphtha, condensate, reformate components and other components used as raw materials to produce products (except petrol); (iii) air conditioners with a capacity of 90,000BTU or less to mount on vehicles.

Under the circular, environmental protection taxes, if any, will be deducted from the calculation of special sales taxes. For domestic goods, the taxable price is determined as follows: selling price without VAT – environmental protection taxes (if any) / 1 + special sales tax rate.

The circular took effect on February 1, replacing Circular No 64/2009/TT-BTC of March 2009. — BIZCONSULT LAW FIRM