Importing fabric bags and leather handbags involves bringing these products from different countries, such as China, South Korea, Japan, Europe, and Thailand, into Vietnam. To successfully navigate the import process, importers need a solid understanding of international trade and familiarity with customs regulations.

In this article, Unicorn Global provides insights into the procedures for importing fabric bags (canvas bags), handbags, fabric bag HS codes, leather bags (skin bags), import duties, VAT, and the import policies applicable to fabric bags. Let’s delve into the essential details below.

1. Fabric and Leather Bag Import Policies

The procedures and policies for importing fabric and leather bags are outlined in the following legal documents:

  1. Decree 187/2013/NĐ-CP dated November 20, 2013
  2. Decree No. 77/2016/NĐ-CP dated July 01, 2016
  3. Circular 38/2015/TT-BTC dated March 25, 2015; amended and supplemented by Circular 39/2018/TT-BTC dated April 20, 2018.
  4. Decree No. 69/2018/NĐ-CP dated May 15, 2018
  5. Official Letter 6313/TB-TCHQ dated September 25, 2020
  6. Decree 15/2022/NĐ-CP dated January 28, 2022

According to the above legal documents, fabric bags do not fall under the list of prohibited imported goods. The import procedures for fabric bags are similar to those for other normal items. However, used fabric bags are on the list of prohibited imports.

For some types of fabric bags with logos of major brands like Starbucks, Coca Cola, Nestle, etc., authorization or confirmation of importation from the brand or its representative office is required. When importing such items, it is essential to consider the following:

  • Used bags fall under the prohibited import category.
  • When importing hinges, labels must be affixed according to Decree 43/2017/NĐ-CP.
  • Ensure the correct HS code for accurate tax determination and avoid penalties.

Legal documents are regularly updated, and new regulations will supplement or replace the existing ones. Therefore, when importing fabric bags, please contact Unicorn Global to stay updated on the latest policies.

2. Labeling Imported Goods

Labeling imported goods is not a new regulation, but it has become more strictly monitored since the issuance of Decree 128/2020/NĐ-CP. Labeling goods serves the purpose of helping regulatory authorities manage products, identify their origin, and determine the responsible unit for the goods. Therefore, labeling goods is an indispensable step when importing fabric and leather bags from various countries.

2.1. Label Content

In addition to the requirement to label goods, the content of the label is crucial. The content of labels for various products is specified in Decree No. 43/2017/NĐ-CP. For bags, the label must contain the following information:

  • Exporter’s information (address, company name)
  • Importer’s information (address, company name)
  • Product name and information
  • Country of origin

These are basic label contents that must be affixed to the goods. The information presented on the label should be in English or other languages and must have translations. When importing bags, if facing any red tape, customs inspection will pay close attention to the label content.

2.2. Label Placement on Goods

Labeling goods is necessary, but placing labels in the correct position is even more critical. When importing, labels on goods should be affixed to surfaces such as cartons, wooden crates, or product packaging. The label can be placed anywhere convenient for inspection and easy visibility. Correct label placement helps save time in customs inspections when processing the import of various bag types.

For bags in the retail market, additional information needs to be displayed. This includes the manufacturer, quantity, technical specifications, production date, and safety warnings.

2.3. Risks of Not Labeling

Labeling goods is a legal requirement, and failing to label goods during importation or providing incorrect label information may lead to the following risks for importers:

  • Fines as specified in Article 22 of Decree 128/2020/NĐ-CP
  • Loss of preferential import tax benefits due to rejected origin certifications
  • Risk of goods being lost or damaged during handling and transportation due to the absence of warning labels.

To mitigate these risks, it is advisable to label goods when importing bags. If you are not fully aware of the labeling regulations, please contact Unicorn Global Vietnam for guidance.

3. Determining the HS Code for Handbags

Determining the Harmonized System (HS) code is the most crucial step when completing the import procedures for any type of goods. Identifying the HS code will determine import taxes, value-added taxes, and import policies. To accurately determine the HS code, you need to understand the characteristics of the goods: materials, components, and product specifications.

3.1. HS Code for Handbags

The HS code (Harmonized System) is a standardized code used globally for all types of goods. The last digits may vary among different countries worldwide. Therefore, the first six digits of the HS code for a specific item are the same worldwide. Below, Unicorn Global provides you with a table of HS codes for handbags.

HS Codes Description
42021110 Handbag HS code for leather, with maximum dimensions of 564525cm
70193200 Other leather handbags HS code
42021211 Handbag HS code for woven fabric with the outer surface of impregnated fibers
42021219 Other woven fabric handbags HS code
42022100 Handbag HS code for handheld bags made of leather or composition leather
42022200 Handbag HS code for handheld bags made of textile materials

Below is a summary table of HS codes for all types of fabric and leather bags. As indicated in the description table, the import tax rate is 25%, and the VAT import tax rate is 8%.

In addition, there are special preferential tax rates for each specific type, indicated by a specific percentage. Unicorn Global does not provide details here, and for specific cases, please contact the hotline or email for advice.

For goods imported from countries such as Europe, India, Australia, Chile, China, South Korea, Japan, and ASEAN countries, importers should request the seller to provide a certificate of origin to enjoy the lowest import tax rate for fabric bags when completing the import procedures.

3.2. Risks of Applying the Wrong HS Code

Accurate determination of the HS code is crucial when importing bags. Applying the wrong HS code poses certain risks for you, such as:

  • Customs procedure delays: Incorrect HS code declaration may lead to delays in customs procedures, as time is needed to verify and confirm accurate information about the type of goods.
  • Penalties for incorrect HS code declaration as per Decree 128/2020/NĐ-CP.
  • Delayed delivery: If the goods are found to have an incorrect HS code declaration, the customs authority may request corrections or clarification of information. This can lead to delays in the delivery process, affecting production and business cycles.
  • In case of import duties, you may face a penalty ranging from at least 2,000,000 VND to a maximum of 3 times the tax amount.
    To accurately determine the HS code for specific types of bags, please contact email for guidance.

4. Calculating Bag Import Taxes

Import taxes are obligations that importers must fulfill when importing fabric and leather bags. Import taxes for fabric bags include two types: import tax and VAT on imported goods. The calculation methods are as follows:
Import tax is determined based on the HS code, calculated using the formula:

Import Tax = CIF Value x % Tax Rate

VAT on imported goods is determined using the formula:

Value Added Tax = (CIF Value + Import Tax) x % VAT Rate

As seen in the formulas, the import tax and VAT on imported goods for fabric bags depend on the % tax rate. The tax rate depends on the HS code for fabric bags, so choosing the correct HS code is crucial. The import tax rates mentioned above are preferential export-import taxes. To enjoy special preferential import tax rates, the shipment must have a Certificate of Origin (C/O). If you do not fully understand the calculation of import taxes and VAT for fabric bags, please contact our hotline or email for advice.

5. Documentation for Importing Fabric and Leather Bags

The set of documents for importing fabric and leather bags, in particular, and completing the import procedures for various goods, in general, is regulated by Circular 38/2015/TT-BTC dated March 25, 2015, amended and supplemented by Circular 39/2018/TT-BTC dated April 20, 2018. The documentation for importing fabric bags includes:

  • Customs declaration form;
  • Commercial contract (Sale contract);
  • Commercial invoice;
  • Bill of lading;
  • Packing list;
  • Certificate of origin (if available);
  • Catalog (if available), and other documents if required by customs.

The essential documents for import procedures for fabric bags are the customs declaration form, certificate of origin (if available), commercial invoice, and bill of lading. Other documents will be supplemented when required by customs.

Unicorn Global emphasizes that the certificate of origin is the most prioritized document. The difference in import taxes for fabric bags with and without a certificate of origin is significant. Therefore, during price negotiations, importers should request the seller to provide a C/O.

6. Import Procedure for Leather and Fabric Bags

The import procedure for leather and fabric bags, as well as for other types of goods, is specifically regulated by Circular 38/2015/TT-BTC dated March 25, 2015, amended and supplemented by Circular 39/2018/TT-BTC dated April 20, 2018. We summarize the steps briefly to give you an overview.

Step 1: Customs Declaration
Once you have all the import and export documents, including contracts, commercial invoices, packing lists, sea waybills, certificates of origin, arrival notices, and determined the HS code for fabric and leather bags, you can input the declaration information into the customs system using specialized software.

Filing a customs declaration on customs software requires importers to have knowledge of data entry into the system. It is not advisable to fill out a customs declaration on your own if you do not fully understand this task. Self-filing can lead to irreversible errors on the customs declaration, incurring significant costs and time to rectify.

Within 30 days from the date the goods arrive at the port, the customs declarant must submit the customs declaration. If this deadline is exceeded, importers may face penalties from the customs authorities.

Step 2: Opening the Customs Declaration
After completing the customs declaration, the customs system will return the results indicating the declaration flow. If the declaration is accepted, print out the customs declaration and bring the import documentation set to the customs office to open the customs declaration. Depending on the flow—green, yellow, or red—follow the steps to open the declaration.

Opening the declaration should be done as soon as possible, within 15 days at the latest from the date of the customs declaration. The declarant must bring the documentation to the customs office to open the customs declaration. If this is not done within 15 days, the declaration will be canceled, and importers will face penalties from the customs authorities.

Step 3: Customs Clearance
After checking the documents, if there are no issues, customs officials will accept the customs declaration for clearance. At this point, you can pay the import tax for the customs declaration to clear the goods.

In some cases, the customs declaration may be released to allow the goods to be taken to a warehouse for storage first. After providing all the necessary documents, customs will proceed with clearing the customs declaration. Until the customs declaration is cleared, procedures must be carried out to obtain clearance. If the deadline is exceeded, you will face penalties and a significant loss of time.

Step 4: Bringing the Goods to the Warehouse and Utilizing Them
Once the customs declaration is cleared, proceed with the steps to settle the customs declaration and carry out the necessary procedures to bring the goods to the warehouse. To bring the goods to the warehouse, prepare the delivery order, pick-up slip at the port, and arrange for transportation. Avoid situations where the customs declaration is completed but there is a shipping line order to remove the goods from the port.

These are the steps in the import procedure for leather and fabric bags. If you do not understand the process, please contact us through the hotline or email for guidance.

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