Changes to exceed the Customs post-clearance audit target

	Hai Phong Customs collects more than 268 billion vnd through Customs post-clearance audits
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Customs officers of the Quang Ninh Customs Department study procedures. Photo: Q.H.

In 2016, the General Department of Vietnam Customs assigned the Quang Ninh Customs Department to conduct Customs post-clearance audits at the headquarters of 55 enterprises (an increase of 14.6% compared to 2015); conduct Customs post-clearance audits at Customs offices for 170 enterprises, and collect revenue of 20 billion vnd to the State budget (a decrease of 33.3% compared to 2015). The major difficulty for the Customs post-clearance audit force of the Quang Ninh Customs Department is the large number of enterprises with modest and unstable import-export activities. In this context, the Customs post-clearance audit force of the Quang Ninh Customs Department has studied and proposed solutions to create a breakthrough in both quality and quantity. One of the new solutions is Customs has collected information of enterprises related to the tax codes, import-export turnover and the investment project for fixed assets to focus on Customs inspections in advance.

M.D thermal power plant has met three criteria of the Customs force. Accordingly, M.D thermal power plant was approved by the Prime Minister in the national development, with a contract value of more than $US 1.2 billion (before imposing tax) and more than $US 895 million including machinery, supplies and imported facilities (accounting for 70%). Contractors will provide all the services related to design, production and transportation of materials, equipment and machinery on the construction site, storage warehousing, construction, assembly and hand over to the investors operated on the basis of "Engineering, Procurement, and Construction" (EPC). Investors will register the list of goods for tax exemption and Customs declaration on the basis of EPC and documents provided by contractors (invoices) under the name of the system line or group of equipment.

In the process of gathering and synthesizing information for the M.D. project, the Customs Branch of post-clearance audits has reported to the Quang Ninh Customs Department to conduct methods of inspections for the M.D. project. The Customs Branch of post-clearance audits has identified 2 major problems violating the tax policies, which Customs force should review carefully before proceeding to inspect at the offices of enterprises, including: classification, application of codes, the tax rate not suitable for goods; and incorrect determination for tax exemption.

At the office of the enterprise, the Customs post-clearance audit force has reviewed, analyzed and focused on the physical inspection of goods installed at the factories, construction sites and examination of technical records. Also, the Customs post-clearance audit force conducted inspections of records and the management and tracking of goods from the first shipment of imported goods; examined accounting records and billing records under the contract between businesses and foreign contractors. The examination of the project documents has been based on the method of "Check-based audit". Instead of examination of the documents of investors and import enterprises, the Customs force has decided to both examine the documents and conduct physical inspections of goods after the installation related to the design, construction, testing and completion of records, which has been considered as a breakthrough in the Customs post-clearance audits at the headquarters of enterprises.

According to the results of Customs post-clearance audits, the Quang Ninh Customs Department has issued a Decision on tax assessment and administrative sanction for this enterprise, thereby collecting revenue of 44.5 billion vnd due to incorrect declaration of tax codes and the tax rate for imported goods, as well as incorrect declaration of tax exemption of imported goods. The enterprise has admitted the results of Customs post-clearance audits and accepted to pay fines and taxes under the Decision on tax assessment and administrative sanctions issued by Customs. Therefore, Customs post-clearance audits have not only prevented losses of State budget revenue but they have also guided enterprises to observe the Law and helped Customs enhance the efficiency of State management on Customs.

The Southern Branch of Customs post-clearance audits collected penalties of 108 billion vnd VCN- On 25th November 2016, the Deputy Director General of the General Department of Vietnam Customs, Mr. ...