Goods in transit tax avoidance

Smuggled goods seized by Ho Chi Minh City Customs Department. Photo: Thu Hoa.

According to the Customs Enforcement Team under Ho Chi Minh City Customs Department, some traders have made use of regulations on free physical inspection of ordinary goods in transit where in fact these goods reqired competent authorities’ permits. Others made use of stipulations of self management and carriage of goods in transit through border gates to bring goods into the domestic market for tax evasion. In some cases, after consignments were moved out of the ports, traders immediately tried to replace goods in the containers, then moved empty containers or put some goods of low value into the containers to exporting border gates. Some even did not carry goods to the checkpoints on withdrawing the contents of the containers.

For example transportation declaration No. 500050661061 dated August 6, 2016 by Binh Chanh International Import - Export Trade and Service Company Ltd could be shown as a typical case. Declared goods in 939 packages were kitchen ware, air-conditioners, electric heaters, water filtration products which were all new. The goods was approved by Sai Gon Port Area No. 1 Customs Branch to be moved on August 6, 2016 and left Cat Lai port on the same date. However, the company did not transport the consignment to Hoa Lu border gate (Binh Phuoc) as regulated, but brought the goods into the domestic market for sale. Sai Gon Port Area No. 1 Customs Branch is handling this case.

In addition, in some cases the manifests showed the traders in Vietnam as the consignees but when Customs and related functional forces detected signs of violations and coordinated to inspect the goods, the Vietnamese traders did not appear to do Customs procedures at that moment and then shifted the consignees to Cambodia and other countries and undertook transit procedures for the consignments. In further information, goods in transit consisting of conditioned imports or banned imports on leaving Viet Nam territory would be brought back Viet Nam by traders via various means and modes such as dividing the consignments into small ones and then transporting them to Viet Nam through small paths, open ways, sided paths or declaring and making use of channeling and exemption from physical inspection to import the goods back. Recently, the Investigation and Anti-smuggling Department under the General Department of Customs has investigated and prosecuted 04 cases concerning used tires. The consignments had been certified to be out of Ho Chi Minh City ports but instead of re-exporting the goods to Cambodia, the traders brought the goods into the domestic market.

Ho Chi Minh City Customs Department have conducted inspections of many suspected consignments in transit at checkpoints and detected containers of prohibited goods and conditioned goods in transit

On August 19, 2016, the Customs Enforcement Team under Ho Chi Minh City Customs Department coordinated with Sai Gon Port Area No. 1 Customs Branch to inspect one consignment in transit under transportation declaration No. 500050514910 by Vinh Thinh Service and Trade Company Ltd (Tax code: 0302574762). Used motors and automobile parts were found in the container. The trader had declared goods in transit as new motors and auto parts. The tentative itinerary of the goods in transit would depart from Cat Lai (Ho Chi Minh City) to Moc Bai (Tay Ninh).

Another case took place on September 14, 2016 when Customs Enforcement Team under Ho Chi Minh City Customs Department in coordination with Sai Gon Port Area No. 1 Customs Branch and the Risk Management Division inspected one consignment in transit owned by Dai Kim Minh Advertisement and Service Company Ltd. The goods was declared to be machinery spares such as number boxes, tires, gas pumps, cylinders, auto springs and heat reducing components which were 100% new with the C/O from Korea. On inspection of the content of the container, all the goods was detected to be banned imports, including 28 used mobile phones of all sorts and used auto parts of all kinds that were on the prohibited import list.

In order to prevent the making use of goods in transit to smuggle, Customs units in the South have reinforced inspection and followed the regulations on declarations for shifting goods to different border gates, temporary admitted goods and goods in transit. The Investigation and Anti-smuggling Department under the General Department of Customs is consolidating dossiers to take consideration of prosecuting serious violation cases recently detected by Customs.