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Detecting the trick of declaring sawdust, exporting sawn timber

10:09 | 28/12/2019

VCN - Over 140 containers of exported timber violating a huge amount of tax fraud have been discovered and handled by the Saigon port area 1 Customs Branch – HCM City Customs Department last week.

detecting the trick of declaring sawdust exporting sawn timber

Decide to stop clearance

Chi Lam Wood Processing Co., Ltd declared the export of 111 containers of sawdust pellets to China, with an export tax rate of 0 percent. When detecting suspicious signs, Saigon port area 1 Customs Branch stopped clearing this shipment and coordinated with the Customs Enforcement Unit - Ho Chi Minh City Customs Department, the Southern Anti-smuggling Enforcement Team - Anti-Smuggling and Investigation Department (General Department of Vietnam Customs) to inspect the shipment. The competent force detected that all goods was declared incorrectly.

On December 18, the Saigon port area 1 Customs Branch continued to inspect export containers of Chi Lam Wood Processing Co., Ltd. All containers were unpacked for detailed inspection. As a result, Customs force found that all goods contained in containers were sawn timber and it was not sawdust pellets as declared by the business. After three days of inspection, the Saigon port area 1 Customs Branch inspected nearly 100 containers, discovered that all exported goods were declared incorrectly. The actual exported goods were sawn timber with a tax rate of 25 percent.

Previously, on 10/12, Saigon Port Area 1 Customs Branch chaired and coordinated with the Customs Enforcement Unit - Ho Chi Minh City Customs Department and the Criminal investigation on corruption, economics and smuggling Police Division (PC03) - Ho Chi Minh City police to conduct physical inspection for a shipment of 25 wooden containers exported to China. The competent force detected that all goods was declared incorrectly.

The above shipment was opened by Saigon A Chau Trading Co., Ltd. with 14 declarations and implemented customs procedures at Chon Thanh Customs Branch - Binh Phuoc Customs Department. According to the enterprises' declaration, the exported goods were "Veneer made from rubber wood", with an export tax rate of 10 percent. The shipment was classified to the yellow channel by the system (checking customs dossiers and the shipment has been cleared). As per the initial result, all goods in 25 containers were sawn timber, with an export tax rate of 25 percent. According to estimates, the shipment value was over VND11 billion so the amount of tax that was evaded by the business was nearly VND3 billion.

detecting the trick of declaring sawdust exporting sawn timber
illegal exported wooden were seized by HCM City Customs. Photo: T.H

What did the owner of the shipment say?

Talking with a reporter, Ms. Le Thi Minh, Director of Chi Lam Wood Processing Co., Ltd said that previously the company exported plywood products, but this time the company signed a contract with Chinese enterprises to export sawn rubber timber. On the foreign trade contract, the enterprise clearly stated that the export item was sawn timber. For 111 export containers of the company that were detained at Cat Lai port, Chi Lam Wood Processing Co., Ltd. did not directly implement customs procedures, the company used customs brokers to implement procedures.

“All dossiers and documents related to the shipment were given to customs brokers to carry out related procedures, such as: fumigation, quarantine, customs declaration. We had prepared money for tax payment, but after a long time of waiting for the cargo to load on board, we requested the customs brokers to provide customs declaration. Then we discovered the customs brokers declaring exported goods as sawdust pellets which was incorrect compared with the goods items of the enterprise,” Ms. Minh said.

For the shipment of 25 wooden containers of Saigon A Chau Trading Co., Ltd., after expanding the investigation, the customs authority detected many problems. This enterprise registered its business at 25 Phan Dinh Phung, Phu Nhuan District, Ho Chi Minh City. However, the verification of customs authority and the confirmation of the local police agency showed that, at this address, Saigon Asia Trading Co., Ltd. only hung the business sign, but they were no longer operating here.

According to Saigon port area 1 Customs Branch, the above violated shipments of timber were exported to China. Through information collection, the Saigon port area 1 Customs Branch detected suspicion from the exported timber shipment, so they stopped clearing those shipments and switched to conduct a physical inspection. As a result, customs authorities detected the enterprise incorrectly declared the actual exported goods and evaded a large amount of tax. Customs authorities would continue to control and check key import-export shipments which were suspected in order to prevent violations and tax evasion.

By Lê Thu/Thanh Thuy