VCN – Several factors affecting the state revenue of HCM City Customs Department in 2018 have been analyzed precisely in order to find solutions for raising revenue sources.
|Customs officers of Saigon port area 4 inspected imported wines. Photo: T.H|
Decrease amount of revenue by over 10,000 billion VND
According to Deputy Director in charge of HCM City Customs Department Dinh Ngoc Thang, there are many factors affecting state revenue collection of the unit in 2018. Based on initial calculations of the effects from tax policies, HCM City Customs Department lost 700 – 1,000 billion VND, with a total loss of over 10,000 billion VND in the whole year. In particular, with the impact of Free Trade Agreements (FTAs), many tariff lines have been cut along the roadmap with more than 90% of commodity lines returning to 0% level. It is anticipated that the import turnover from the FTA countries will increase. In addition, in recent years, state revenues collected from petrol, steel, fertilizers, and cars, have been decreasing year by year. In the last four years, the Department’s revenue has decreased by 8,424 billion VND from these groups.
Furthermore, with the impact of anti-dumping and safeguard duties, the import turnover of steel items has decreased in the first months of the year. The Customs Law cases had a large impact when many enterprises registered business licenses and settled their transaction center in HCM City, but they completed procedures and paid tax in other regions. Thus it led to decreasing revenue collection of 1,788 billion VND. The impact from state revenue collection of petrol by Nghi Son refinery and petrochemicals - when Thanh Hoa starts operating for meeting domestic demand, Van Phong port and Khanh Hoa operate stably, will also cause a significant drop in revenue collection for HCM City Customs Department from petrol items.
Especially, from the beginning of 2018, the impact of Decree No.116 / 2017 / NĐ-CP dated 17/10/2017 of the Government on conditions of imported cars that was valid from 1/1/2018 has affected the total of imported cars under 9 seats. Up to now, only 1 company has imported a car shipment with more than 1,000 units. In the first two months of 2018, the Hiep Phuoc Port Customs Branch and Saigon Port area 3 Customs Branch (HCM City Customs Department) collected only 583 billion VND while those branches collected 2,700 billion VND in the same period of 2017. Thus, these 2 units reduced their revenue by 2.117 billion VND from importing cars.
According to the HCM City Customs Department, in the first two months of 2018, although the import turnover increased quite high (15.2%) and VAT increased by 620 billion VND compared with the same period in 2017, the import duty decreased by 1,500 billion VND compared to the same period in 2017 due to reduction of tax lines by the FTA. From the impact of the above mentioned, according to estimates of HCM City Customs Department, the ability of revenue collection from import - export operation can only reach a maximum of 100 trillion VND, reaching 92.6% compared to the ordinance (108 trillion VND) and can only achieve 91.7% of the actual state revenue in 2017.
Solutions for compensation of shortfall in revenue
In 2018, the HCM City Customs Department has been assigned a target revenue collection of 108 trillion VND. Although the target is reduced by 1,000 billion VND compared to 2017, with a deficit of more than 10,000 billion VND, HCM City Customs Department has come up with a number of measures to achieve the target.
Besides the solutions for facilitating trade, raising revenue, the HCM City Customs Department has specific groups of solutions. In particular, for the group of state revenue collection and tax debt management, HCM City Customs Department will strive not to generate bad debt in 2018 without appropriate reason. When new tax arrears arise, the customs branches shall have to promptly make dossiers, coordinate and actively collect tax debts, immediately apply measures to stop the procedures in order to request enterprises to pay taxes, not waiting until the 91st day for applying tax enforcement for tax debt recovery. At the same time, arranging, consolidating and reforming all tax debt tracking dossiers, making dossiers which are eligible to propose to the People's Committee of Ho Chi Minh City and the General Department of Vietnam Customs to remove tax debts. Furthermore, developing a scheme to apply the taxable price policy to 200 enterprises that have complied well with customs law according to the plan “the business community and HCM City Customs Department are reliable partners in the development of the year 2018 " in order to report to the leaders of the General Department of Vietnam Customs for approval.
For loss of revenue prevention, continue to organize consultations and post clearance audit at the customs offices for all export and import goods which have suspected tax calculation prices in accordance with the current import - export tax tariff, in that prioritizing to strict inspection of commodity groups in accordance with Official Letter No. 905 / TCHQ-TXNK of the General Department of Vietnam Customs. Also, concentrating on inspection and control of the customs declaration of "green channel" by following the special project in order to prevent enterprises from taking advantage of the leak in law for smuggling and trade frauds.
Particularly, the Customs Branches need to grasp thoroughly each customs to change officials’ awareness, thinking and management methods: To concentrate on inspection and control key enterprises, newly established ones, high risks, importing key goods of great value. Strengthening and raising the sense of responsibility for each executing official in the determination of customs valuation. When the tax calculation value is determined, the State revenue collection and payment agency shall have to make the assessment. Being highly determined not to allow a business to have enough time for dissolution or to run away.
Additionally, the classification group, determination of tax rates, should be arranged by excellent Customs officers who are HS code experts, with an enthusiasm for work in order to check and review HS codes, or report to leaders of HCM City Customs Department for timely correction. With the priority target "one item with one HS code"; Regularly review on the VNACCS-VCIS, MHS, GTT systems ... to detect shipments which are declared with a wrong code; Advising the HCM City Customs Department to adjust, collect the tax payment to the State revenue in time ... in order to achieve the 2018 target..
By Lê Thu/Thanh Thuy