Revenue from major commodity groups plunges: Lao Cai Customs

	Lao Cai Customs: Many challenges arise when revenue collection falls sharply
	Lao Cai Customs enables export of agricultural products

60% of goods imported and exported across Kim Thanh No.2 International Border Gate are agricultural products but the revenue from the products is insignificant. Photo: T.B

According to Lao Cai Customs Department, as of June 15, the department’s revenue saw a year-on-year decrease of 48% to VND395.24 billion, meeting 26.3% of the target assigned by the Ministry of Finance.

The department said that the fall in revenue resulted from the sharp decline in volume and turnover of taxable items and major products such as phosphorus, DAP fertilizer, coke, machinery and equipment, and electricity.

As of June 15, 2023, the total turnover of taxable goods dropped by 53.2% compared with the same period in 2022.

For example, due to the reduction in demand for yellow phosphorus on the world market, phosphorus manufacturers in Lao Cai had to reduce production volume and selling price. In June 2023, Duc Giang Chemical Company lessened the export price of yellow phosphorus to an average of VND120 million/ton, down 20-30% compared to the previous year (VND150-170 million/ton).

The turnover of phosphorus products dwindled 62.2% compared with a year ago to US$143.4 million.

Responding to the situation, Lao Cai Customs Department expects the revenue from phosphorus export in the second half of 2023 to continue to go down compared with the previous year.

The soaring freight cost caused difficulties for enterprises to hire ships and empty containers, significantly reducing the quantity of phosphorus exports.

Investment projects in Lao Cai province were put into stable operation, so the demand for imported machinery and equipment dropped. In the first five months of the year, the revenue from imported machinery and equipment for key projects in the locality did not arise.

The large revenue from Ammonium Nitrate - NH4NO3 (explosive precursors) in 2019, 2020 and 2021 recorded over VND50 billion with a turnover of over US$20 million/year. However, the revenue from this item from 2022 to the current date only reached VND10 billion with a turnover of US$4 million.

The decrease is due to the fact that there is no warehouse or yard meeting safety conditions for fire prevention in accordance with the law on storing, transhipping, loading and unloading at the Kim Thanh Lao Cai Border Gate area.

In 2022, the revenue from imported electric energy also contributed VND30.76 billion at Lao Cai Customs Department. However, from December 2022 until now, this item has not been imported, which is also the main reason for the sharp decrease in revenue. It is known that the Chinese side is short of electricity supply, so it cannot meet Vietnam's electricity import demand.

Regarding the decline in coke import, Lao Cai Customs Department said that due to the decrease in demand at domestic production plants, Vietnam - China steel mills located in Lao Cai province stopped operating and had no demand for coke import, leading to a plunge in coke imports year-on-year. Lao Cai Customs Department forecasts that in the second half of the year, this item will have no revenue because the factory has not resumed operation.

To complete the revenue target, Lao Cai Customs Department determines that the department will make great efforts and expedite solutions to increase revenue in the last months of the year. The department will effectively implement Directive No. 479/CT-TCHQ dated February 6, 2023, by the Director General of Vietnam Customs on trade facilitation and improvement of the effectiveness of state management, prevention of revenue loss in performing tasks in 2023.