Hai Phong Customs: Collecting tax debt effectively

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Customs operations at Hai Phong Customs Branch of post-clearance audit. Photo: Thai Binh.

Take advantage and initiative

In 2017, Hai Phong Customs Department conducted Customs procedures for 20,923 enterprises, and many of which are based in many provinces and cities across the country. This poses a lot of difficulties and challenges to Customs post-clearance audit forces in monitoring and assessing the compliance of enterprises. The process of organizing inspections and evaluations at the headquarters of enterprises outside the area was difficult, but the urge to execute the tax assessment decision was much more difficult.

One of the typical cases involving tax collection was the case of Regal Automobile (based in Hanoi). On 29 August 2017, Hai Phong Customs Department issued Decision No. 3330 / QD-HQHP to impose tax on Regal Automobile Joint Stock Company with an amount of VND 7.35 billion and Announcement 10958 / TB-HQHP for late payment of VND 1.504 billion. The reason was to re-determine the taxable value of the imported goods.

Following the above mentioned decision, on 20 September 2017, Regal Automobile Joint Stock Company sent the Official Letter 1909/2017 / CV-TXNK to Hai Phong Customs Department and General Department of Vietnam Customs to comply with the tax assessment decision. However, the company was in difficulty, so it was requested to fulfill a part of the tax obligation and for the remaining tax amount to be paid gradually.

Pursuant to the provisions of the law and in order to facilitate the business, the Customs office has agreed to let the company gradually pay the tax. The settlement of tax debts shall comply with the provisions of Article 39 of Decree No. 83/2013 / ND-CP guiding the implementation of the Law on Tax Administration and the Law amending and supplementing a number of articles of the Law on tax management.

However, businesses still find many reasons for delay. In order to solve this situation, Hai Phong Customs post-clearance audit Branch had to organize many delegations to work directly with the company in Hanoi.

"At the beginning of November, 2017, Regal Automobile Joint Stock Company signed a commitment with the Taxation Department to fulfill the tax obligation in November or at the end of December 2017. But by 2017, the company only paid VND 7 billion and owed nearly VND 2 billion. At present, the Customs Branch is taking measures to stop Customs procedures with the company in accordance with the Law", said the leader of the Customs Branch.

Another case related to tax debt handling was Thanh Cong Automobile Joint Stock Company (Quang Ninh). By reviewing and analyzing Customs declaration, the Customs authorities determined that the company had incorrectly declared the excise tax rate on 5-seat Ford F-150 pickup trucks. Specifically, when carrying out import procedures, the company declared a special tax rate of 15% (for both passenger and cargo). However, according to the certificate of quality, technical safety and environmental protection of imported motor vehicles issued by the Vietnam Register, the value of "Carriage by Design" and "Volume of Carriage" were not recognized. Therefore, the excise tax rate must be exactly 60%.

After issuing the tax assessment decision, the Customs authorities took many measures to urgently recover the debt such as issuing many official letters and urging the company to pay taxes; requesting the legal representative of the Company to go to the headquarters of the Customs office, and sending staff directly to the company's headquarters. However, the legal representative of the company gave many reasons for absence and failed to pay tax.

Under that situation, based on the provisions of the Law, the Customs office issued the enforcement decision in the form of deducting money from the company's bank account. The banks cooperated well with the Customs office, deducted remittance to the account of the Customs at the State Treasury 3 times, and recovered a large amount of tax (VND 1.136 billion).

"Currently, the company owed a tax amount of nearly VND 100 million, the Customs authorities are monitoring and urging the company to pay taxes. In the case where the company still failed to pay tax debt, the Customs office shall carry out the coercive measures as provided for in Article 93 of the Law on Tax Administration,"said the representative of the Customs Branch.

According to the leader of the Customs Branch, with a great effort and the coordination of agencies and relevant units, in 2017, the tax debt collection achieved very positive results, reducing the tax debt from more than VND 72 billion in early 2017 to only about VND 3 billion.

Centralized examination

In 2017, Hai Phong Customs Department collected a tax amount of VND 366.66 billion from the work of Customs post-clearance audit, exceeding VND 6.66 billion compared to the target. In particular, the Customs Branch of post-clearance audit collected VND 336 billion, and other units collected VND 30.66 billion. The result of Customs post-clearance audit from Hai Phong Customs Department in 2017 was ranked second among 35 local Customs Departments (behind HCM City Customs Department) and contributed nearly 16.5% of post-clearance audit of the whole industry.

In 2017, Hai Phong Customs Department actively developed a project to implement the tasks of Customs post-clearance audit in 2017 and successfully completed the criteria compared with the plan, especially the amount of tax collection. In particular, in 2017, the unit successfully carried out a number of major inspections such as: the subject of processing goods, export production; ships; specialized inspections in automobile, electronic goods; and specialized tax on steel and billets.

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Regarding the implementation of the task in 2018, the leader of the Customs Branch of post-clearance audit said that based on the leadership of the General Department of Vietnam Customs, Hai Phong Customs Department, at the beginning of the year, the Customs Branch operated actively. In the coming time, the Customs Branch will continue to focus on the key tasks related to checking and assessing the compliance of enterprises in order to contribute to preventing budget deficit. More importantly, the operation of Customs post-clearance audit will help businesses understand and properly implement Customs laws and policies. In addition, the Customs Branch shall actively manage AEO enterprises and advise the leaders of the Department to direct and organize the implementation of the work of Customs post-clearance audit. In addition, the Customs Branch shall focus on urging the recover of all tax debts and strive not to generate new tax debt.