Customs sector responds to pressure revenue target in the second half of 2023

	Customs sector earns VND184 trillion in the first half of 2023
	What does Hanoi Customs do to revive revenue?

Ninh Binh Customs Branch (Ha Nam Ninh Customs Department) assigns officers to grasp status and handle problems of enterprises. Photo: H.N

Suffering from difficulties

According to Resolution No. 69/2022/QH15 dated November 11, 2022, the National Assembly assigned the revenue estimate of VND 425,000 billion to the Customs sector, including the export duty of VND9,200 billion, import duty of VND67,292 billion; Excise Taxs of VND32,200 billion, environmental protection tax of VND824 billion, VAT of VND 315,400 billion and other revenue of VND84 billion.

According to economic experts, in the first half of the year, the Russia - Ukraine war was complicated, causing the slow recovery of the world economy, and the tightening of monetary policy has led to the plunge in consumption of consumers in the world.

At the same time, the global supply chain continues to face the risk of interruption, affecting import-export activities and economic growth. Major economies that are Vietnam's export partners such as the United States and the EU have reduced spending on purchasing conventional and luxury products, leading to the plummet in the volume of orders, especially for products such as textiles and garments, production of beds, cabinets, tables, chairs, metal production. Meanwhile, the prices of petroleum products constantly fluctuate.

The factors caused the year-on-year decrease of 15.1% in total import and export turnover in the first half of the year to US$ 316.64 billion; total taxable import-export value of the whole country dropped 21.3%. Of which, the taxable import turnover and taxable export turnover fell 21% and 24% to US$58.4 billion and US$3.5 billion, respectively.

Notably, the taxable import turnover of commodity groups plunged, especially raw materials, machinery and equipment, and spare parts imported for productions such as coal, chemicals and chemical products, plastics, iron and steel, textile raw materials, electronic components, auto parts... accounting for 47.2% of total taxable import turnover, down 26.7% year-on-year, leading to the decrease in revenue of VND21,400 billion compared with the previous year.

The volume of imported petroleum products reached 4.2 million tons, with the value of US$3.3 billion, up 11% in volume and down 16% in value, reducing revenue by about VND2,600 billion year-on-year.

However, the revenue from some commodity groups showed positive results. Notably, the volume of imported CBU cars reached 70,792 thousand cars with taxable import turnover of US$ 1.63 billion, up 11.4% in volume and 4.7 in value, increasing revenue by VND5,100 billion. The imported crude oil grew 41% in volume and 10% in value to 5.9 million tons and US$ 3.6 billion, respectively, raising revenue by VND570 billion year-on-year.

According to the Import and Export Duty Department, as of June 30, the revenue of 10 major local customs departments saw a year-on-year decline of 15.5% to VND162,042 billion, meeting 43.52% of the estimate. Dong Nai Customs Department’s revenue decreased by 30.64%, Ha Tinh Customs Department’s revenue dropped 29.01%, Binh Duong Customs Department’s revenue down 28.3%, Ba Ria-Vung Tau down 24.4%, Bac Ninh Department down 20.04%.

The decrease in revenue at these 10 customs departments results from the year-on-year plunge of 20%-50% in the import turnover of raw materials, machinery and equipment imported for production such as coal and chemical products and plastics

The fact shows that the export orders falls so the demand for importing raw materials for production of enterprises also plummets. Specifically, the total import-export turnover of goods cleared at Hanoi Customs Department only reaches 87.8% year-on-year. Accordingly, the revenue of the department goes down 15.48% year-on-year to VND14,178 billion, meeting 42.8% of the estimate.

The total import and export turnover at HCM City Customs Department drops 20.34%. The revenue from major commodities slumps such as petroleum products down 18.73%, imported computers, electronic products and components down 41.34%, imported iron and steel down 36%, leading to the decrease in revenue of the department to VND4,000 billion.

The import and export turnover also sees the decline due to the lack of orders as reported by local customs departments of Bac Ninh, Binh Duong, Dong Nai, Hai Phong, Thanh Hoa…

According to the Import and Export Duty Department, the revenue of the whole sector in June dropped 1.66% compared with May due to that Quang Nam Customs Department refunded taxes for auto parts under Articles 7a and 7b of the Decree 101/2021/ND-CP worth about VND1,000 billion.

Responding to this situation, the Customs sector has grasped the business production of enterprises to make plans for revenue collection and target allocation to departments; drastically implement solutions to facilitate trade, improve the effectiveness of state management, prevent revenue loss, etc. However, due to many objective reasons, the revenue of the whole Customs sector plunges 19.9% to VND 183,744 billion, meeting 43.23% of the estimate.

Five solution groups

The decrease in indicators in the first half of the year shows that the revenue collection in the second half of the year suffers from difficulties. To accomplish the task, the General Department of Vietnam Customs has requested units in the whole sector to review performance in the Customs control area and operation of enterprises to estimate revenue; monitor and supervise the revenue payment and focus on creating new revenue; actively contact enterprises to understand status of enterprises and support them.

The GDVC’s leader requires customs units to drastically implement five solution groups.

The first, continue to implement customs reform modernization, facilitate trade and import-export activities, shorten the time and cost of Customs clearance. Effectively implement Decision No. 123/QD-TCHQ dated January 31 aiming to reducing the rate of Yellow and Red channels and 10% of customs clearance time.

The second, continue to apply international standards and modern customs management processes to create maximum convenience for the business community while ensuring strict supervision and management in accordance with regulations.

The third, strengthen measures to prevent revenue loss through inspection and supervision. Accordingly, mobilize resources to combat revenue in terms of quantity, weight, category and name of goods; use scanners to detect suspicious signs; comprehensively implement solutions to control the imported general goods under the direction of Official Dispatch No. 119/TCHQ-GSQL on improving the effectiveness of customs inspection and control.

Take measures to manage customs value in customs clearance and post-clearance audit; prevent and handle cases that falsely declare customs value for tax fraud and tax evasion; regularly review to promptly detect and handle cases that the same item but the results of analysis and classification are not consistent within the customs branch, customs department and Customs Department of Good Verification; strengthen measures to improve the effectiveness of anti-origin fraud...; strictly control the tax exemption, reduction and refund, ensure the tax exemption, reduction and refund, and expedite the inspection and examination of the law compliance.

The fourth, review, classify, recover and handle tax debts arising before January 1 under four groups: bad debt, pending debt, frozen debt and recoverable debt. At the same time, apply appropriate solutions as prescribed for each debt group.

The fifth, strictly comply with the regulations on fiscal policy and the conclusions and recommendations of the inspection and audit teams, the Central Inspection Commission; strengthen internal inspection and internal self-inspection.