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MINISTRY OF
FINANCE
GENERAL DEPARTMENT OF TAX
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SOCIALIST
REPUBLIC OF VIETNAM
Independence - Freedom - Happiness
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No.2935/TCT-CS
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Hanoi, July 03,
2017
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To:
- People's Committee of Yen Bai province;
- Tax Department of Yen Bai province;
- Tax Department of Phu Tho province
In response to Official Dispatch No.3015/CT-TTHT
dated June 12, 2017 of the Tax Department of Phu Tho province, Official
Dispatch No.683/UBND-XD dated April 17, 2017 of People's Committee of Yen Bai
province and Official Dispatch No.270/CT-KTT dated January 24, 2017 of the Tax
Department of Yen Bai province regarding determination of exchange rate for
calculation of tax paid by foreign contractors, below are opinions from the Tax
General Department after notifying the aforesaid Official Dispatch to the
Ministry of Finance:
1. Regarding exchange rate for calculation of
value-added tax (VAT) and corporate income tax paid by foreign contractors:
a. Before January 01, 2015 (the effective date
of Circular No.200/2014/TT-BTC):
Pursuant to regulations in Point 1.18 Section I
Part B of Circular No.129/2008/TT-BTC dated December 26, 2008, Clause 22
Article 7 of Circular No.06/2012/TT-BTC dated January 11, 2012 and Circular
No.219/2013/TT-BTC dated December 31, 2013 of the Ministry of Finance on
guidelines for VAT, point 5 Part B of Circular No.130/2008/TT-BTC dated
December 26, 2008 and Clause 6 Article 3 of Circular No.123/2012/TT-BTC dated
July 27, 2012 and Circular No.78/2014/TT-BTC dated June 18, 2014 of the
Ministry of Finance providing for guidelines on corporate income tax:
Revenues earned by foreign contractor before
January 01, 2015 must be converted into Vietnam at the interbank average
exchange rate quoted by the State on the transaction date for the purpose of
calculation of VAT and corporate income tax.
b. From January 01, 2015 onwards:
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Pursuant to regulations in Clause 4 Article 2 of
Circular No.26/2015/TT-BTC dated February 27, 2015 of the Ministry of Finance
on amendments to Article 27 of Circular No.156/2015/TT-BTC:
Revenues earned by foreign contractor from January
01, 2015 must be converted into Vietnam dong at the buying rate quoted by the
commercial bank at which his/her account is opened on the transaction date.
b2. For the case in which the foreign contractor
does not have an account opened at a commercial bank in Vietnam:
Pursuant to regulations in Point 1.18 Section I
Part B of Circular No.129/2008/TT-BTC dated December 26, 2008, Clause 22
Article 7 of Circular No.06/2012/TT-BTC dated January 11, 2012 and Circular
No.219/2013/TT-BTC dated December 31, 2013 of the Ministry of Finance on
guidelines for VAT, point 5 Part B of Circular No.130/2008/TT-BTC dated
December 26, 2008 and Clause 6 Article 3 of Circular No.123/2012/TT-BTC dated
July 27, 2012 and Circular No.78/2014/TT-BTC dated June 18, 2014 of the
Ministry of Finance providing for guidelines on corporate income tax:
Article 1 of Decision No.2730/QD-NHNN dated
December 31, 2015 of the State Bank:
“Article 1. Every
day, Vietnam’s State Bank (State Bank) will announce the official exchange rate
between Vietnam dong and US Dollars on its website.”
Clause 2 Article 1 of the aforesaid Decision:
“2. “Official
exchange rate between Vietnam dong and US Dollar" in this Decision is “the
interbank average exchange rate between Vietnam dong and US Dollar”.
Clause 1 Article 5 of the aforesaid Decision:
“1. This Decision comes into force from January 04, 2016.”
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- For the period of time from January 01, 2015 to
before January 04, 2016 (the effective date of Decision No.2730/QD-NHNN): The
foreign currency revenue shall be converted into Vietnam dong at the interbank average exchange rate quoted by the State
Bank on the transaction date.
- From January 04, 2016 onwards: The foreign
currency revenue shall be converted into Vietnam Dong at the exchange rate
between Vietnam Dong and US Dollar quoted by the State Bank in Decision
No.2730/QD-NHNN on the transaction date.
2. Regarding VAT invoice issuance:
Clause 2e Article 14 of Circular
No.153/2010/TT-BTC dated September 28, 2010 and Clause 2e Article 16 of
Circular No.39/2014/TT-BTC dated March 31, 2014 of the Ministry of Finance
dealing with methods for providing particular information in the invoice:
"e) Currency on invoices:
...The seller must
write the exchange rate on the invoice according to the average exchange rate
on inter-bank foreign exchange market announced by the State bank of Vietnam
when the invoice is issued.
If the foreign
currency collected does not have an exchange rate with Vietnam dong, an
exchange rate between that currency and another foreign currency of which the
exchange rate is announced by the State bank of Vietnam shall be written.”
Pursuant to the aforementioned regulations, foreign
contractors must issue VAT invoices which specifies exchange rate between the
foreign currency and Vietnam dong applicable on the date of invoice issuance
instead of the exchange rate agreed in the contract.
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PP. DIRECTOR
GENERAL
DEPUTY DIRECTOR GENERAL
Cao Anh Tuan