Import tax incentives are one of the important policies that help businesses reduce costs, optimize profits and expand international markets. Through trade commitments such as EVFTA, CPTPP or ASEAN, Vietnam is applying many special preferential tax rates for import and export goods, but not all businesses clearly understand the conditions and how to apply them. The following article will help you understand when you are entitled to preferential import tax, how to look up the tax schedule and note to avoid mistakes that lead to additional collection or penalties.
What are import-export tax incentives and why should businesses care?
Import tax incentives are policies to exempt, reduce or apply lower tax rates than normal for import and export goods, based on international commitments that Vietnam has signed such as WTO, ASEAN, EVFTA, CPTPP, RCEP...
Not simply a measure to reduce tax obligations, this policy also plays an important role in promoting two-way trade, supporting businesses to save costs, increase price competitiveness and expand market share in international markets. In fact, some product lines can have their import tax reduced from 5% to 100% if they meet the right preferential conditions, helping businesses save tens to hundreds of millions of VND for each shipment.
Taking advantage of tax incentives effectively is not only an opportunity, but also a strategic advantage in the context of deep integration as it is today.
Special preferential tax rates: Concept and conditions of application
According to the Law on Import and Export Tax 107/2016/QH13, the special preferential tax rate is a tax rate lower than the MFN tax rate, and is only applied if the following conditions are fully met:
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Goods on the preferential list in signed free trade agreements (FTAs).
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Have valid certificate of origin (C/O) such as form E (China), EUR.1 (EU), AK (ASEAN – Korea)… in correct form and correct shipment.
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Ensure direct transportation from the country of origin to Vietnam, without being divided/transferred incorrectly.
If a business does not meet the conditions, even if it imports from a country with an FTA, it will not be subject to special preferential tax rates.
Countries enjoy preferential import tax with Vietnam
By 2025, Vietnam has signed more than 17 free trade agreements with countries and regions around the world. Some partners with large import and export volumes enjoying special preferential tax rates include:
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ASEAN (ATIGA): goods may decrease to 0%
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China, Korea, Japan (ACFTA, AKFTA, AJCEP): apply C/O form E, AK, AJ
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European Union (EU): according to EVFTA, the roadmap to reduce taxes on many products to 0%
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CPTPP: applies to 10 countries such as Australia, Canada, Mexico, Singapore...
These agreements help Vietnamese businesses import raw materials with lower taxes, and export goods more easily to large markets.
Preferential import tariff schedule 2025 and practical examples
The 2025 import tariff continues to clearly show the differentiation between MFN (most favored nation) tax and special preferential tax rates according to the FTAs that Vietnam participates in. Some typical products that enjoy deep preferential tax rates are as follows:
| Item | HS Code | MFN Tax (%) | Special preferential tax (FTA) |
|---|---|---|---|
| Laptop | 8471.30 | 5% | 0% (EVFTA, CPTPP, ATIGA) |
| Cars under 9 seats | 8703.21 | 70% | 50% (ASEAN), 30% (CPTPP) |
| Cold rolled steel coil | 7209.17 | 10% | 5% (China – ACFTA) |
| Pharmaceuticals | 3004.90 | 0% | 0% (preferential in most agreements) |
Real life situation: A business imports laptops from China, with a full set of valid C/O form E. Instead of having to pay tax at the MFN rate of 5%, the business enjoys the tax rate of 0% under ACFTA. With a shipment worth 1 billion VND, the tax exemption is up to 50 million VND - a significant savings that helps the business increase profits and improve competitiveness in the market.
Notes when applying import tax incentives
In the process of implementing preferential import-export tax procedures, enterprises need to be absolutely careful with factors that directly affect the legality and validity of the applied tax rate.
First of all, incorrect identification of HS codes will lead to incorrect tax rates, additional collection or penalties as prescribed in Decree 128/2020/ND-CP, causing significant financial losses. Second, if a business fails to provide a valid certificate of origin (C/O) in the correct form, country and shipment, even if it imports from a country that has signed an FTA with Vietnam, it will not be eligible for special preferential tax rates.
In addition, businesses also need to regularly update the latest import tax schedule because FTA agreements are constantly adjusted according to the commitment roadmap. Failure to keep up with these changes can easily cause businesses to apply old tax rates, miss out on incentives, or be assessed as having made incorrect declarations.
It should be emphasized that errors in applying preferential taxes not only cause cost losses, but also seriously affect business reputation, especially in the context of global supply chains that increasingly require high accuracy and transparency.
Conclusion and recommendations for businesses
Understanding and applying correctly preferential import tax policy not only helps businesses reduce tax costs, but also ensures legality in international trade activities. From determining HS codes, checking conditions for preferential treatment under FTA to choosing the appropriate tax schedule, each step requires precision and in-depth legal knowledge.
In case businesses have difficulty looking up tax schedules, verifying the validity of C/O, or completing preferential declaration documents, please consider using MAN Auditing ServicesMAN's team of experienced experts will accompany you throughout the entire import-export process, ensuring efficiency and maximum compliance with current regulations.
