Revenue from major imports and exports at Lao Cai Customs plunges

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The revenue collection at Lao Cai Customs Department in the first seven months of 2023 compared with the same period in 2022.

Revenue only reaches 35%

Lao Cai Customs Department collected VND525.04 billion, reaching 35% of the target assigned by the Ministry of Finance and 22.3% of the target assigned by the local government, down 47% year-on-year.

The decrease in the department’s revenue results from the difficult situation in business production of enterprises, less orders and high interest rates. In addition, China’s border gate management agencies have closely controlled subordinate border gates and increased tax rate, causing import and export activities across Lao Cai province.

Notably, the three commodities with large revenue as phosphorus, coke, and fertilizer, plunged compared with the same period in 2022.

Due to the sharp decrease in the world consumption demand, phosphorus companies have reduced both production quantity and selling price. The average price of exported yellow phosphorus in previous months reduced 33% or US$2,000/tons to US$4,000/tons. The revenue from this item in the first seven months of the year dropped 61% or VND323.6 billion to VND207.3 billion.

The domestic factories and phosphorus production factories decreased the demand of importing coke, and Vietnam - China steel mill stopped operation. Therefore, the revenue from this item in the first seven months of the yearfell by 55.5% or VND44.99 billion to VND36.14 billion compared with the year ago.

Regarding imported fertilizers, due to the sharp decrease in domestic demand, and no longer application of safeguard tax,and the reduction of import duty from 5% to 3% under the Regional Comprehensive Economic Partnership (RCEP), the revenue from this item only dropped 57.6% or VND24.94 billion year-on-year to VND18.37 billion.

The revenue from three major commodities declined VND393.53 billion, accounting for about 84% of Lao Cai Customs Department’s revenue in the first seven months of the year.

In addition, the revenue from other imported items also fell due to the decrease in domestic demand such as iron and steel, electronic products, chemicals, gypsum, machinery and equipment.

On the other hand, key investment projects in Lao Cai have come into stable operation, so the need to import machinery and equipment for investment projects in the area plunges.

Needs effective solutions

To achieve the revenue target in 2023, Lao Cai Customs Department continues to strictly follow Directive No.479/CT-TCHQ of the Director General of Vietnam Customs on implementation of solutions for trade facilitation, improvement of effectiveness of state management, and anti-revenue loss in the implementation of the state revenue collection in 2023.

The department reviews enterprises in the province, attracts and facilitates enterprises to import and export goods at the department.

The department also removes problems related to customs procedures, tax policies, tax administration, tax refund, tax exemption, and implements customs reform and modernization, tax administrative procedures, and facilitates enterprises.

The department strengthens supervision and control of declaration of name, code, quantity, and customs value and tax rate of goods to ensure full collection of taxes and feesand other revenues.

To further promote the potential and advantages of the province to promote the growth of import and export turnover and increase budget revenue, Lao Cai Customs Department proposed the Lao Cai Provincial People's Committee and relevant agencies to invest in infrastructure at Lao Cai International Railway Station and Kim Thanh II International Border Gate.

Currently, the customs checkpoint for imports and exports at Lao Cai International Railway Station has not met management requirements. The site and warehouse for gathering of imports and exports has not been arranged separately. The area is too narrow, making it difficult for management and attracting businesses to import and export by the railway.

Therefore, the department proposed the Lao Cai Provincial People's Committee and relevant sectors to build a place for gathering import and export goods to ensure the customs control and create favorable conditions for the customs control while facilitating import and export activities.

In order to facilitate the import of explosive precursors (Ammonium Nitrate - NH4NO3) at Kim Thanh II International Border Gate, the department proposed the local government to remove difficulties in arranging warehouses and yards eligible for storing and transshipping explosives precursors imported across this border gate.