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THE MINISTRY OF FINANCE
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SOCIALIST
REPUBLIC OF VIET NAM
Independence - Freedom - Happiness
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No. 19/2006/TT-BTC
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Hanoi,
March 15, 2006
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CIRCULAR
GUIDING THE CLASSIFICATION OF AUTOMOTIVE PARTS AND
ACCESSORIES
Pursuant to Export Duty and
Import Duty Law No. 45/2005/QH11 of June 14, 2005,
Pursuant to Customs Law No. 29/2001/QH10 of June 29, 2001, and June 14, 2005
Law No. 42/2005/QH11 Amending and Supplementing a Number of Articles of the
Customs Law;
Pursuant to the Government’s Decree No. 77/2003/ND-CP of July 1, 2003, defining
the functions, tasks, powers and organizational structure of the Finance
Ministry;
The Ministry of Finance guides the classification of imported automotive parts
and accessories for application of preferential import duty rates prescribed in
Decision No. 57/2005/QD-BTC of August 10, 2005, as follows:
I. GENERAL PROVISIONS:
The list and import duty rates of automotive parts and accessories
issued together with Decision No. 57/2005/QD-BTC shall apply to the
classification and calculation of payable tax of parts and accessories in
knock-down sets in replacement of the calculation of payable tax of parts
in CKD and IKD forms stipulated in the Finance Minister’s Decision No.
110/2005/QD-BTC of July 25, 2003. Accordingly, the import duty rates are
prescribed on the following principles:
- Automotive parts and accessories that may be used for different kinds
of automobiles are subject to a uniform import duty rate irrespective of kinds
of automobile. For example: glass, mirrors, electric wire sets, etc.
- Other automotive parts and accessories are subject to import duty
rates varying according to kinds of automobiles (basically four major kinds:
automobiles for the transport of under 16 persons; automobiles for the
transport of 16 persons or more; cargo trucks with a maximum loaded tonnage not
exceeding 5 tons and those of a maximum loaded tonnage exceeding 5 tons).
2. The classification of and application of import duty rates to
automotive parts and accessories under the guidance of this Circular uniformly
apply to imported accessories and parts irrespective of whether they are used
for manufacture, assembly, maintenance, repair, business or other purposes.
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The list and import duty rates of automotive parts and accessories are
stipulated in List I and List II issued together with Decision No.
57/2005/QD-BTC of August 10, 2005, of the Minister of Finance (hereinafter
collectively referred to as List), specifically as follows:
1. List I has been formulated on the basis of the Preferential Import
Tariffs. Each 4-digit commodity heading consists of many sub-headings but only
some of 6-digit or 8-digit sub-headings cover automotive parts and accessories.
To facilitate the commodity reference and classification by customs declarers
and customs offices, the commodity headings still include all of their 6-digit
and 8-digit sub-headings.
Example: In heading 7007 (safety glass, of hardened glass or rolled
glass), only 8-digit sub-heading 7007.11.10 covers safety glass of a kind used
for automobiles. However, in order to facilitate reference and classification,
the list still contains all sub-headings of heading 7007.
2. List II covers a number of automotive accessories and parts already
classified according to general regulations in List I. However, in order to
distinguish the duty rates applicable to accessories and parts of each kind of
automobile, the List makes separate classifications (automobiles for the
transport of under 16 persons; automobiles for the transport of 16 persons or
more; cargo automobiles with a maximum loaded tonnage not exceeding 5 tons and
those with a maximum loaded tonnage exceeding 5 tons). Accordingly, some categories
of accessories and parts in several sub-headings in List I must be transferred
to List II for application of different import duty rates. The sub-headings of
commodities transferred to List II are marked with asterisks at the duty rates
in List I.
Example 1: In List I, 8-digit sub-heading 8409.99.41 (carburetors and
parts thereof) has the preferential import duty rate of 15% marked with an
asterisk (*), which means that this sub-heading covers some automotive parts to
be specified in List II which are subject to a duty rate other than 15%. Upon
classification, it is necessary to refer to List II which stipulates a duty
rate other than 15% for carburetors of which kinds of automobiles,
specifically:
- List II specifies “carburetors and parts thereof of a kind used for
cargo trucks and automobiles for the transport of 16 persons or more” at Item
4.1. with the preferential import duty of 10%. So, if carburetors and parts
thereof are of a kind used for cargo trucks and automobiles for the transport
of 16 persons or more, the duty rate of 10% specified in List II shall apply
instead of the duty rate of 15% in List I. Accordingly, “carburetors and parts
thereof” of a kind used for automobiles for the transport of under 16 persons
(not specified in List II) are subject to the duty rate of 15% specified in
sub-heading 8409.99.41 of List I.
Example 2: In List I, sub-heading 8708.99.99 (others) has the
preferential import duty rate of 30% marked with an asterisk (*), which means
that this sub-heading covers some kinds of accessories to be specified in List
II which are subject to a duty rate other than 30%, specifically:
- The commodity “Leaf springs” at Item 20.1 of List II is subject to
the preferential import duty rate of 20%; parts and accessories (excluding leaf
springs) in sub-heading 8708.99.99 at Item 20.2 of List II are liable to the
preferential duty rate of 5%. Meanwhile, chassis not fitted with engines are
liable to the preferential import duty rate of 30% specified in sub-heading 8708.99.99
in List I.
Other automotive parts and accessories that are not specified in any
headings in Lists I and II above shall be classified and liable to import duty
rates specified in the Preferential Import Tariffs issued together with the
Finance Minister’s Decision No. 110/2003/QD-BTC of July 25, 2003, decisions
amending and supplementing Decision No. 110/2003/QD-BTC, and Circular No.
85/2003/TT-BTC of August 29, 2003, guiding the classification of goods
according to the List of Imports and Exports, the Preferential Import Tariffs
and the Export Tariffs.
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3. A number of headings and sub-headings covering automotive
accessories and parts and other commodities are all liable to the import duty
rates specified in Decision No. 57/2005/QD-BTC, unless such sub-headings
separate automotive accessories and parts for application of different duty rates.
Example 1: Sub-heading 7099.10.00 “Rear-view mirrors of a kind used for
motor vehicles” has the preferential import duty rate of 30%, which means that
this duty rate is applicable to rear-view mirrors of all kinds of motor
vehicles, such as automobiles, motorbikes, etc.
Example 2: Sub-heading 8544.30.10 “Ignition wiring sets and other
wiring sets of a kind used for motor vehicles” has the preferential import duty
rate of 20%, which means that this duty rate is applicable to ignition wiring
sets and other wiring sets of all kinds of motor vehicles, such as automobiles,
motorbikes, etc.
4. Though a number of headings in the List include headings and
sub-headings covering automotive accessories and parts and other commodities,
only automotive accessories and parts are separated and liable to different
duty rates in List II and other commodities are still liable to duty rates
specified in List I.
Example: In sub-heading 8519.99.30 of audio equipment of a kind using
compact discs, only those of a kind used for automobiles are separated and
specified at Item 11 of List II and are liable to the duty rate of 30%. Other
audio equipment of this sub-heading are liable to the duty rate of 50%
specified in List I.
III. CLASSIFICATION PRINCIPLES:
The classification of automobile parts and accessories shall comply
with Circular No. 85.2003/TT-BTC of August 29, 2003, guiding the
classification of goods according to the List of Imports and Exports, the
Preferential Import Tariffs and the Export Tariffs. Following are specific
regulations for a number of particular cases:
1. Classification of automotive parts in complete or incomplete
knock-down sets:
1.1. Imported parts in complete or incomplete knock-down sets for
automobile manufacture or assembly are all classified and taxed according to
each heading/sub-heading at the duty rate prescribed for each detail and part
specified in Decision No. 57/2005/QD-BTC and relevant documents.
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- Accessories and parts are imported directly or through entrustment by
enterprises that satisfy the standards of automobile manufacture or assembly
enterprises stipulated by the Ministry of Industry.
- Details and parts in knock-down forms may be finished products which
must, however, have basic characteristics of component products for assembly
together at the knock-down degree at least equal to the knock-down degree of
automotive part sets stipulated in Decision No. 05/2005/QD-BKHCN of May 11,
2005, of the Minister of Science and Technology.
The condition on the knock-down degree stipulated in Decision No.
05/2005/QD-BKHCN is not applicable to the cases of manufacture and assembly of
special-use automobiles on the basis of automotive chassis fitted with engines
(chassis automobiles).
1.3. When an automobile manufacture or assembly enterprise imports
automotive parts in the incomplete or complete knock-down form for automobile
manufacture or assembly with the knock-down degree lower than that stipulated
in Decision No. 05/2005/QD-BKHCN, it shall pay an import duty thereon at the
duty rate applicable to automobiles in complete units.
1.4. The classification of parts and details in knock-down forms shall
be effected according to the knock-down degree upon importation. If each detail
is imported in the knock-down form, classification shall be made according to
details; if detail assemblies are imported, classification shall be applied
according to detail assemblies; it is not allowed to separate details in each
assembly for classification and application of different tax rates.
2. Specific classification of a number of automotive accessories and
parts:
a/ Chassis fitted with engines and chassis not fitted with engines:
- Chassis fitted with engines are classified in heading 8706; depending
on their types (chassis of cargo trucks, automobiles for the transport of
persons, special-use automobiles, etc.,), they shall be classified in different
sub-headings of heading 8706.
- Chassis not fitted with engines are classified in sub-heading
8708.99.99 of heading 8707.
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c/ Gear boxes and other speed acceleration structures and clutches of a
kind used for automobiles are classified into corresponding sub-headings of
heading 8708 but not in heading 8483.
d/ Other parts and accessories in Item 20 of List II: Parts and accessories
in this item do not cover all other automotive parts and accessories not yet
specified or included elsewhere in List I and List II but only cover parts and
accessories in sub-heading 8708.99.99, including:
- Leaf springs, which are liable to the preferential import duty rate
of 20%.
- Chassis not fitted with engines, which are liable to the preferential
import duty rate of 30% specified in List I.
- Other parts in sub-heading 8708.99.99, which are liable to the
preferential import duty of 5%.
3. Parts used for cargo trucks with a total loaded tonnage exceeding 20
tons:
1.1. Parts and accessories of headings 4011; 4012;4013; 4016; 6813;
7007; 709; 8415; 8421; 8481; 8482; 8484; 8507; 8511; 8512; 8519; 8539; 8544;
8708.29.13; 8708.29.17; 8708.29.93; 8708.29.17; 9029; 9104 and 9401; automotive
bodies in sub-headings 8708.29.93 and 8708.29.87; chassis not fitted with
engines in sub-heading 8708.99.99 are liable to the preferential import duty
rates specified in Lists I and II.
1.2. Other parts and accessories (not including parts and accessories
specified in Item 1.1) which may only be used for cargo transport with a total
loaded tonnage exceeding 20 tons are liable to the uniform import duty rate of
3%.
Example 1: Bodies of cargo trucks with a total loaded tonnage exceeding
20 tons are classified in sub-headings 8708.29.93; 8708.29.97 (among parts and
accessories specified in Item 1.1.). So they are liable to the import duty rate
of 20% prescribed for bodies of trucks in general.
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4. Parts and accessories of automobiles for the transport of both
persons and cargo:
4.1. Parts and accessories of automobiles for the transport of both
persons and cargo are classified and liable to the preferential import duty
rate applicable to parts and accessories of cargo trucks with a total unloaded
tonnage not exceeding 5 tons.
Example: Reciprocating internal combustion engines of automobiles for
the transport of both persons and cargo with a capacity of over 1,000 cc and
completely assembled are classified in Section 2.2 of List II together with
cargo trucks and liable to the import duty rate of 20%.
4.2. For parts and accessories fit in compartments for the transport of
persons but not used in cargo trucks shall be classified as similar parts and
accessories of automobiles for the transport of persons in heading 8703.
5. Parts and accessories of special-use automobiles:
Parts and accessories of special-use automobiles (excluding special-use
automotive bodies and special-use equipment and parts) are classified as and
liable to rates applicable to parts and accessories of automobiles for the
transport of persons and of cargo trucks corresponding to automobiles of base
types used for manufacture of special-use automobiles, specifically:
- If special-use automobiles are manufactured from base automobiles
being cargo trucks, their parts and accessories shall be classified as and
liable to duty rates prescribed for accessories and parts of cargo trucks of
corresponding type:
Example 1: For freezing automobiles manufactured and assembled from
base automobiles being cargo trucks with a total loaded tonnage not exceeding 5
tons, their accessories and parts shall be classified as and liable to import
duty rates applicable to parts and accessories of cargo trucks with a total
loaded tonnage not exceeding 5 tons.
Special-use parts of freezing automobiles: freezing equipment,
insulation panels, etc., are classified into relevant codes in the Preferential
Import Tariffs. For example: freezing equipment is classified in heading 8418.
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Example 2: For ambulances manufactured and assembled from base
automobiles being automobiles for the transport of under 16 persons (including
driver), their accessories and parts shall be classified as and liable to
import duty rates applicable to accessories and parts of automobiles for the
transport of under 16 persons.
Special-use parts of ambulances: stretches, horns, emergency medical
treatment equipment, etc., are classified in relevant codes in the Preferential
Import Tariffs. For example: stretches are classified in heading 9402,
sub-heading 9402.90.10 with the import duty rate of
0%.
IV. ORGANIZATION OF IMPLEMENTATION:
1. Issued together with this Circular is a list of automotive parts and
accessories of sub-headings based on the commodity database of the World
Customs Organization for reference by customs declarers and customs offices.
2. In the course of implementation, if appear parts that may be
commonly used for different kinds of cars but are subject to two different
import duty rates, local customs offices shall immediately report them to the
Ministry of Finance (the Tax Policy Department and the General Department of
Customs) for timely handling.
3. This Circular takes effect 15 days after its publication in “CONG
BAO”. In the course of implementation, any arising problems should be promptly
reported by units, organizations and individuals to the Ministry of Finance for
settlement.
FOR THE MINISTER
VICE MINISTER
Truong Chi Trung
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