HCM City Customs handling tax debt

Check tax debt records of enterprises at Saigon port area 1 Customs Branch. Photo: T.H

“Roll call” of enterprises owing large debts

Among enterprises owing tax debts announced by the Ho Chi Minh City Customs Department, most of them are those who have intentionally delayed paying tax debt for many years.

Although Ho Chi Minh City Customs Department has implemented debt recovery solutions, these have not succeeded. There are many enterprises owing large debts such as NIVL Joint Stock Company with more than VND152 billion; Silver Star Vietnam Co., Ltd with more than VND47 billion; Kwang Nam Footwear Manufacturing Co., Ltd. with more than VND35 billion; Hoang Phuoc Minh Import-Export Trading Service Company Limited, with more than VND41 billion; Thanh Nien Joint Stock Company with over VND33 billion.

Many businesses operating in the outsourcing field also incurred large debts more than a decade ago. For example, Hung Sang Plastic Garment Co., Ltd., owes more than VND30 billion; Hoang Giang Trading, Production and Service Private Enterprise owes nearly VND26 billion; A Chau Garment and Trading Co., Ltd., owes more than VND24.5 billion.

Besides that, many cases arise from post-clearance audit conducted by the Customs authority, but the enterprises intentionally delayed paying tax under the arrears decision of the customs authority. In particular, there is the case of Gia Phuc Garment Joint Stock Company, which owes more than VND47.5 billion; Huu Lien Asia Joint Stock Company, which owed more than VND 35 billion; Nam Viet Refining and Petrochemical Joint Stock Company, owes more than VND26 billion.

Most of the above cases have lasted more than 10 years. Thanh Nien Joint Stock Company owes more than VND33 billion of tax debt at Saigon Port Area 3 Customs Branch since 2008. Although the company is still operating, it has been nearly ten years since the day of arising tax debt, this company has not yet fulfilled its tax payment obligation to the State. In many times working with the Customs authority, the Director of the enterprise made a commitment to gradually pay the outstanding tax but he still did not follow the commitment.

There is also the case of owing debt of more than VND47 billion of Silver Star Vietnam Co., Ltd. arising from 2007. At the end of November 2007, this enterprise registered at the Investment/Processing Customs Branch to perform a processing contract of 1.4 million pairs of sports shoes and sandals of all kinds.

The contract period was for one year. During the contract period, Silver Star Vietnam Co., Ltd. made over 470 import-export declarations. By November 2008, at the end of the contract period, the Company did not liquidate the contract, which means that the number of imported raw materials and accessories had not been determined whether they had exported processed products or not and the amount of import tax for with the corresponding amount of outstanding raw materials.

This business is no longer operating at its registered address. Through verifying at the immigration management agency, the competent force discovered that the director of this company was a foreigner who had returned home.

Many strong measures

From the first months of 2022, HCM City Customs Department has directed units to review and implement effective measures to recover tax arrears, including applying coercive measures as prescribed.

On February 25, 2022, the Manager of Saigon port area 3 Customs Branch signed and issued Decision No. 06/QD-KVIII on the enforcement of tax debt for Thanh Nien Joint Stock Company (address: 28-30-32-34 Pasteur, Nguyen Thai Binh Ward, District 1, Ho Chi Minh City).

According to this decision, the customs authority applied coercive measures by stopping implementing customs procedures for exported and imported goods (except for goods specified in Clause 2, Article 131 of the Law on Tax Administration dated June 13, 2019) to enforce Notice No. 56 /TB-KVIII dated February 23, 2022 on tax debt and late payment interest. According to Saigon port area 3 Customs Branch, the reason is that Thanh Nien Joint Stock Company did not comply with the tax payment according to notice No. 56/TB-KVIII dated February 23, 2022 on tax debt and late payment by the Saigon Port Area 3 Customs Branch, with the coercive amount of over VND33.268 billion.

The Manager of Tan Thuan Export Processing Zone Customs Branch (HCM City Customs Department) has just signed the announcement of the suspension of immigration for Mr. Le Anh Tu (born on July 17, 1965, who was a director and legal representative of T&C Trading and Production Company Limited; tax code: 0101019977; Business Registration Certificate number: 0102000311; business address: 73 Mai Hac De, Bui Thi Xuan Ward, Hai Ba Trung District, Hanoi City). The reason for the suspension was the enterprise's failure to comply with the tax arrears notice of the customs authority; the period of temporary suspension was from March 1, 2022 until taxpayers complete their tax payment obligation into the state budget.

Similarly, in the case of director of Binh An Trading Production Company Limited (tax code: 0302452316; business registration certificate number: 91/QD-PĐKKD; business address: 244 Nguyen Thi Dinh, ward Binh Trung Tay, District 2, Ho Chi Minh City - now in Thu Duc City, Ho Chi Minh City) was also temporarily suspended from leaving the country because of intentionally delaying to pay tax.

Accordingly, Le Dinh Binh, director and legal representative of Binh An Trading Production Co., Ltd., was notified by the Tan Thuan Export Processing Zone Customs Branch to suspend leaving the country from March 1, 2022.

According to Tan Thuan Export Processing Zone Customs Branch, as of June 30, 2020, T&C Trading and Production Co., Ltd owed over VND131 million (including fines for late payment); Binh An Trading Production Co., Ltd owes over VND271 million of monetary penalty for late payment.

According to the customs branches, during the collection process, there are cases where the business has stopped operating and abandoned its registered address, but the customs authority can find the address and phone number of the legal representative to invite them to the customs office, but the debt collection was also ineffective.

Regulatory enforcement measures are only effective for businesses that are still operating. As for the business that have moved, it is considered "hands-on" because it cannot be applied.

Not only being aggressive with cases of intentionally delaying payment of import and export tax, HCM City Customs Department also coordinated and supported Ho Chi Minh City Tax Department to handle many cases of intentionally delaying tax payments in accordance with the Law on Tax Administration.

At the Investment Customs Branch - Ho Chi Minh City Customs Department, the leaders of the customs branch signed and issued a decision to stop carrying out customs procedures for imported and exported goods in more than 30 cases. In particular, there are many cases of tax debt from several billions to tens of billions of VND. Notably, after implementing coercive decisions, some businesses have fulfilled the obligation to pay taxes to the State budget.