Import tax on plastic bags

28/09/2020

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Table of Contents

1. What is the HS code for plastic bags?
2. What is the import tax on plastic bags?
3. What are the import procedures for plastic bags?

Are you manufacturing and trading plastic bags and need to learn about plastic bag import procedures? Are you wondering how much the import tax on plastic bags is? How is the environmental protection tax on PE bags calculated? What is the HS code for plastic bags? Join Hoang Phuc Pack to find out the details in this article.

Import tax on plastic bags

1. What is the HS code for plastic bags?

The HS code for plastic bags is a specific code designated for plastic bag items/products based on the nature, characteristics, and composition of the plastic bags.

The HS code for plastic bags is regulated by the World Customs Organization to be applied in the classification of plastic bags, valuation, and issues related to plastic bag packaging import-export documents. Based on these classification HS codes, it is easy to control issues related to each specific item when importing and exporting.

1.1 Purpose of HS Code

The HS code plays an important role as a basis for the following:

Customs tariff schedule.
Collect international trade statistics.
Product rules of origin
Domestic taxation of businesses.
International trade agreements between countries (for example, the World Trade Organization's schedule of tariff concessions) between countries under regimes such as most-favored-nation, for example.
Tariff schedules and transport statistics.
Control goods (for example, waste, narcotics, chemical weapons, ozone-depleting substances, highly endangered species, etc.)
Control and customs procedures related to the import-export field, including related risks.

1.2 So, what is the HS code for plastic bags?

Based on the 2020 import-export tariff schedule, the HS code for plastic bags includes:

– Section VII: Plastics and products of plastics, rubber and products of rubber
– – Chapter 39: Plastics and products of plastics.
– – – Heading 3923: Articles for the conveyance or packing of goods, of plastics; stoppers, lids, caps and other closings, of plastics. Packaging and bags (including cones)
– – – – Subheading 392329 – Other plastics
– – – – – 39232990 – Other plastic bags for packing goods from LLDPE and TERPP mixtures, PE bags, PP bags, OPP bags, cosmetic bags, document bags, two-handle bags, aluminum bags, coffee bags, etc.

So the general HS code for plastic bags is: 39232990.

2. What is the import tax on plastic bags?

Plastic bags subject to tax (plastic bags) are thin plastic bags or packaging in the shape of a bag (with a bag opening, bag bottom, bag walls, and able to hold products inside) made from single plastic film HDPE (high density polyethylene resin), LDPE (Low density polyethylen) or LLDPE (Linear low density polyethylen resin).

Pre-packaged goods packaging and plastic bags that meet the environmental friendliness criteria from the date they are issued the Certificate of Environmentally Friendly Plastic Bags by the competent authority according to the regulations of the Ministry of Natural Resources and Environment are not subject to environmental protection tax.

2.1 Import tax on plastic bags

For plastic bag items, when importing and exporting, businesses must pay a certain amount of tax as follows:

Value added tax (VAT): 10% based on Circular 83/2014/TT-BTC
Normal import tax on plastic bags: 22.5% based on Decision 45/2017/QD-TTg
Preferential import tax: 15% according to Decree 125/2017/ND-CP. This preferential tax rate applies in cases where you import-export from countries that have free trade agreements with Vietnam.

2.2 Environmental protection tax on PE bags

Based on the Environmental Protection Tax Law No. 57/2010/QH12 dated November 15, 2010; Resolution No. 1269/2011/UBTVQH12 dated July 14, 2011 of the Standing Committee of the National Assembly; Article 1 of Circular No. 159/2012/TT-BTC dated September 28, 2012 of the Ministry of Finance, plastic bags are items subject to environmental protection tax.

The environmental protection tax rate for PE bags that businesses must pay is: 40,000 VND/kg – 50,000 VND/ kg.

Note, the basis for applying the tax code is based on the actual goods imported by businesses at the time of import, on the basis of the business providing technical documents (if any) or/and going for inspection at the Customs Analysis and Classification Center.

The actual inspection results of the customs where the company performs procedures and the results of the Analysis and Classification Center are determined as the legal and accurate basis for applying the code to that imported goods.

3. What are the import procedures for plastic bags?

For any product when importing and exporting, certain procedures are required. If you need to import plastic bags, you need to prepare the import procedures documents below:

3.1 Determine HS code and export tax when importing plastic bags

Each product has an HS code with different import-export regulations and requirements, therefore if you want to import-export plastic bags, you must determine the HS code and the requirements according to the customs department's import-export regulations for this item.

The HS code for plastic bags is 39232990. The import-export tax on plastic bags is currently 10% (VAT) and the preferential tax is 15%

3.2 Customs documents when importing plastic bags

To import plastic bags, you need to prepare a set of documents with all the papers to register and confirm with the customs department. Below are the basic documents you need to prepare to declare with customs when importing-exporting plastic bags:

Import customs declaration
Commercial Invoice (commercial invoice)
Bill of Lading (also known as a sea waybill): understood as a transport document issued by the sea carrier or their representative, signed and delivered to the shipper or cargo owner to transport goods under the contract between the buyer and the seller.
Certificate of Origin – Certificate of Origin (C/O - if any)
Other documents (if any)

Note: Above are the basic documents you need to prepare before importing, you should contact import-export document consulting units to get answers to questions and update the latest information (decrees or documents are continuously changed and updated) to help you complete the plastic bag import documents as quickly as possible, avoiding affecting your business.

3.3 Costs and time for importing plastic bags

The cost of importing plastic bags is calculated based on 2 factors: shipping cost and tax.

Shipping cost is calculated based on the characteristics of the goods and the type of transport. Each type of transport will have a different calculation method. You should determine the mode of transport and communicate directly with the customs department or shipping units to calculate the shipping cost.
The import-export tax on plastic bags as of now is: VAT tax is 10%. The preferential import tax rate is 15%. In addition, you also have to pay the environmental protection tax for this item. Depending on the quantity imported, the tax amount will change differently. Currently, the environmental protection tax that businesses must pay for imported plastic bags is: 40,000 VND/kg – 50,000 VND/ kg.

The import time will be closely related to the time for preparing documents, procedures as well as the transport means you choose.

In addition, the nature of the goods also affects the import time. Depending on the nature of the goods such as: weight, quantity, size, shape… and the level of requirements, the international imported goods can therefore choose the type of transport by sea, air, road, express delivery, etc.

Each shipment needs to be considered specifically to make the most suitable decision. Therefore, depending on the purpose of use, businesses have their own choice.