On November 17, 2025, the Customs Department issued Official Letter No. 36442/CHQ-NVTHQ regarding tax policies applicable to goods subcontracted for processing when the enterprise does not have a production or processing facility.
Details of the guidance are as follows:
An enterprise with a processing contract may deliver imported raw materials or semi-finished products to a third party for partial or full subcontracted processing. The enterprise may then receive back the semi-finished products for further processing or receive the finished products for export.
In this case, a subcontracting enterprise—even if it does not have a production facility in Vietnam—may still be exempt from import duty provided it satisfies the conditions set out in Clause 4, Article 1 of Decree No. 18/2021/NĐ-CP, specifically:
- The taxpayer must have a processing contracting accordance with Decree No. 69/2018/NĐ-CP and must declare it on the customs declaration.
- The enterprise receiving the subcontracted processing must:
- Have ownership or the right to use the processing facility, machinery, and equipment in Vietnam; and
- Notify the customs authority of the subcontracting facility and the subcontracting contract as required by law.
(According to Official Letter No. 36442/CHQ-NVTHQ dated November 17, 2025)
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