Perfecting the law on import and export tax towards exemption and reduction for the right subjects

Scientific workshop "Implementation of FTA commitments and issues related to state budget revenue" organized by the Institute of Financial Strategy and Policy (Ministry of Finance) in coordination with the Customs Research Institute (General Department of Customs) on November 1, 2024 in Ninh Binh.

Deputy Director General of the General Department of Customs Luu Manh Tuong spoke at the workshop. Photo: NV

Deputy Director General of the General Department of Customs Luu Manh Tuong affirmed that import-export tax collection is one of the major sources of revenue in the total state budget revenue, helping to balance the financial policy of revenue and expenditure.

Therefore, implementing the roadmap for tariff reduction under FTAs ​​is not only a matter for the management agency but also for the business community.

According to statistics from the Institute of Strategy and Financial Policy, the implementation of commitments in FTAs ​​has caused the proportion of import tax collection to decrease from 6.1% in 2011 to 2.5% in 2023.

The proportion of revenue from export duties also decreased from 3% (in 2011) to 0.5% (in 2023) in the total state budget revenue.

Scientific workshop "Implementing FTA commitments and issues related to state budget collection". Photo: NV

Sharing about this issue, Dr. Nguyen Nhu Quynh, Director of the Institute of Strategy and Financial Policy, said that cutting import taxes according to the roadmap of FTA commitments not only causes domestic goods to face strong competition with imported goods but also affects the proportion of state budget revenue from import and export taxes.

According to the General Department of Customs, the implementation of the tariff reduction roadmap due to FTAs ​​has reduced the state budget revenue of the Customs sector.

In 2021, the state budget revenue of the Customs sector decreased by about VND 17,600 billion, in 2022 by about VND 16,500 billion, in 2023 by about VND 15,000 billion, and in 2024 it is expected to decrease by about VND 14,000 billion.

Furthermore, some countries have stricter regulations on the origin of imported goods to minimize the risk of taking advantage of trade facilitation policies and tariff incentives to evade taxes through smuggling, trade fraud, counterfeiting of origin, geographical indications, etc.

Mr. Nguyen Van Hoan, Deputy Director of the Anti-Smuggling and Investigation Department (General Department of Customs) shared that, in addition to falsely declaring the name, type, quantity, value of goods, etc., smugglers also use new, sophisticated, and unpredictable methods and tricks to commit fraud and evade taxes.

For example, falsely declaring the origin of goods, falsifying the origin of goods issued by competent authorities, or self-certifying the origin of goods that is inconsistent with the nature of the origin of goods and geographical indications of goods.

Statistics from December 16, 2023 to September 14, 2024, the Customs sector has detected, arrested and handled 12,949 cases of customs law violations, with an estimated value of violated goods of VND 23,757 billion.

The Customs agency has prosecuted 21 cases and transferred 128 cases to other agencies for prosecution. The amount collected for the State budget is VND 522.58 billion.

Dr. Nguyen Nhu Quynh, Director of the Institute of Strategy and Financial Policy, spoke. Photo: NV

Therefore, to overcome these situations, experts believe that it is necessary to synchronously implement many financial solutions, remove difficulties to develop businesses...

Deputy General Director of the General Department of Customs Luu Manh Tuong said that to make good use of the FTA, there are still many problems.

Among them, it is necessary to perfect the legal policies on import and export taxes in the direction of strict management and exemption for the right subjects.

At the same time, expand the tax base that has not been considered, such as e-commerce; pay attention to policies that affect exports such as digital transformation, circular economy to encourage businesses to transform technology.

In addition, there should be a mechanism to review inappropriate domestic legal policies to make timely adjustments to help increase the effectiveness of FTA implementation, etc.

Experts also recommend that Vietnam needs to increase sustainable trade turnover to increase tax collection at the import stage, while continuing to reform the synchronous tax system, both encouraging economic sectors to develop and ensuring financial resources to meet the needs of economic and social development.