Commodity classification procedures unified to prevent losses

	Customs verification helps to support specialized inspections
	Handling the case of Customs and enterprises disagreeing over the identification result
	Deal with equitization and divestment in State enterprises

Customs operations of the Thai Nguyen Customs Branch (the Bac Ninh Customs Department). Photo: T. Trang.

The classification of exports and imports is based on the name, description of nature, composition, packing specifications and other attributes of the goods to determine and classify the goods under The Harmonized Commodity Description and Coding System, the list of Vietnamese exports and imports and other relevant Laws. These commodity codes will be defined based on the import and export tariffs under the list of import and export tariffs. These classification procedures have unified the different classification points among entities before issuing the notice of classification results. Accordingly, MHs software system can be stored information related to the Customs and local Customs Departments can easily look up the classification results of the goods.

Along with that, regulations on pre-determination of commodity codes and origin of goods, which have been implemented by the General Department of Vietnam Customs recently have also helped enterprises to proactively calculate business efficiency and reduce business costs. At the same time, it helps the Customs office increase management effectiveness. Most of the documents sent to the Import-Export Duty Department within 30 days as usual and within 60 days for complicated cases.

The implementation of pre-determining commodity codes is beneficial for both Customs and business. Accordingly, the Customs force can improve the productivity and efficiency of management by speeding up the clearance of goods, allocation of resources before, during and after Customs clearance. On the other hand, businesses will base legally binding information to conduct market research, business planning, and profit calculation. This increases the solidity and help enterprises predict when participating in international trade transactions. The classification of goods is also updated on the website of the General Department of Vietnam Customs to help businesses to refer to the application of the classification of goods.

However, in fact, enterprises have misrepresented the codes of goods in order to enjoy the lower tax rates or in some cases where Customs officers accept the classification of goods declared by the enterprises different from items of the same characteristics and types.

Regarding this issue, Mr. Trinh Mac Linh, the Deputy Director of the General Department of Vietnam Customs said that in fact, there were various types of imports and exports in terms of types and technologies, especially multi-functional and multi-use commodities. Therefore, the classification of the Customs has faced a lot of difficulties, because there are different perceptions on the nature of the goods and the capacity of the Customs in the classification of goods is limited.

Also, in recent times, there have been complicated imports causing controversial opinions as follows: drinks without gas, drinks containing collagen; creams for scarring; artemia eggs for the animal; a connection device for the internet; ceiling air conditioner; tools for sharpening knives and marbles. In order to properly classify this item, the Import-Export Duty Department has consulted professional agencies and held many meetings. For complicated items, the General Department of Vietnam Customs also must organize dialogues with businesses to both listen and provide guidance in the classification of goods.

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According to Mr. Trinh Mac Linh, in order to further improve the efficiency of the classification of goods, the application of tax rates, the uniform classification of goods across the country, timely detection and handling of incorrect declaration and coding are the targets of the Customs in the classification and determination of tariffs in 2017.