>> Vietnam starts refunding VAT to foreigners
This fulfills a decree the Ministry of Finance issued in April in an effort to boost sales. It stipulated that, to qualify for the 10-percent VAT refund, foreigners must present receipts worth at least VND2 million (roughly US$100) apiece.
VAT is paid back in Vietnam dong. Thus, foreigners are responsible for exchanging dong for foreign currencies. Payments are processed immediately after travelers complete refund declarations and invoice inspections at the airport.
Under the pilot program that runs until June 30, 2014, foreigners are required, upon purchase, to show their passport or immigration paper and in return, the retailer will provide them with a VAT refund declaration form that they then will check and sign in.
When they arrive at the airports, they will be required to present the document to the customs office.
At the VAT refund counter, they will be required to submit the original copy of a boarding pass for an international flight and the original copies of invoices and the VAT refund declaration form with the Customs office “checked” seal to get the VAT returned.
According to the Ministry of Finance, foreigners and overseas Vietnamese are both eligible for VAT refunds on purchases in local accredited stores with the ‘VAT Refund for Tourist’ logo.
However, those who are working for airlines are excluded from the refund scheme.
The duration of stay by foreigners eligible to claim the refund remains unclear.
Most Asean countries allow tourists to claim back the VAT paid on goods that they have bought in accordance with their own rules and regulations.
In Indonesia, visitors spending at least Rp 5 million (US$532) in local shops would be entitled to the cash-back incentive.
In Singapore, foreigners would have to spend at least SGD$100 (US$79) per invoice to get the 10 percent VAT returned.
In Thailand, the total amount needed for the VAT refund must not be less than THB5,000 ($158).
If the pilot program runs smoothly, Vietnam will not have to wait for two years as previously planned to begin applying the scheme on a large scale, VietnamNet quoted Hoang Viet Cuong, Deputy General Director of the General Department of Customs, as saying.
However, Cuong admitted to the newswire that there is always a big gap between will and implementation.