HCMC handled smuggled goods and detected income from warehouse leasing of over VND 10 billion excluding in accounting books

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Competent agencies inspect infringing goods at 621 Pham Van Chi, Ward 7, District 6 on June 2019. Photo: Standing Office of the National Steering Committee 389.

More than VND 10 billion was excluded in accounting books

In a meeting with the Standing Office of the National Steering Committee 389 on May 14, the representative of the General Department of Vietnam Customs (GDVC) said that during handling a case related to smuggled and banned goods at District 6 (HCMC), competent agencies detected the income from warehouse and yard leasing was up to hundreds of millions of VND per month but was not shown in the accounting books.

According to the document, Minh Tam Trading and Warehouse Services Company Limited (headquartered in District 1, HCM) has a branch as Minh Tam Trading and Warehouse Service Company Limited (located at 621 Pham Van Chi, Ward 7, District 6) that has a contract on leasing warehouses and yards of Binh Tay Packaging and Warehouse Joint Stock Company from 2015 to June 2019.

Notably, on September 14, 2017, Binh Tay Packaging and Warehouse Joint Stock Company was directed by the Ho Chi Minh City People's Committee on terminating the leasing of premises at 621 Pham Van Chi, Ward 7, District 6.

On November 1, 2019, Binh Tay Packaging and Warehouse Joint Stock Company (the lessor) and Minh Tam Trading and Warehouse Services Co., Ltd (the lessee) terminated the contract.

But after the contract was terminated, the Binh Tay Packaging and Warehouse Joint Stock Company continued to lease the warehouse at this address to Minh Tam Trading and Warehouse Services Co., Ltd without the contract and only by a verbal agreement.

Also on November 1, 2017, Minh Tam Trade and Warehouse Services Co., Ltd stopped signing contracts with organizations and individuals that re-rented warehouses and only leased through a verbal agreement.

Regarding the income from warehouse and yard leasing, the Branch of Minh Tam Trade and Warehouse Services Company Limited has a turnover of about VND 670 million to VND 680 million / month and repaid more than VND 624 million/ month for Binh Tay Packaging and Warehouse Joint Stock Company.

Director General of the General Department for Market Surveillance Tran Huu Linh spoke in a meeting with Standing Office of National Steering Committee 389 on May 14, 2020. Photo: T. Binh.

After the competent forces checked the warehouses at the above address (in June 2019), following the direction of the HCMC People's Committee, the HCMC Tax Department inspected Minh Tam Trade and Warehouse Services Co., Ltd and Binh Tay Packaging and Warehouse Joint Stock Company.

Minh Tam Trade and Warehouse Services Co., Ltd has moved its headquarters to District 2, HCMC, and carried out procedures for suspension of operation for 1 year (from October 20, 2019 to 19 October 10, 2020), therefore, the HCMC Tax Department could not contact the Company to announce its decision and conduct an inspection.

On October 23, 2019, HCMC issued a decision to inspect Binh Tay Packaging and Warehouse Joint Stock Company.

As result, the monthly income of Binh Tay Packaging and Warehouse Joint Stock Company from warehouse leasing at 621 Pham Van Chi, Ward 7, District 6 for 20 months (from November 2017 to June 2020) has not been recorded in accounting books and declared for payment of Value Added Tax and Enterprise Income Tax according to regulations.

The monthly income includes warehouse and yard renting is more than VND 624 million, service fee (electricity, water ...) is VND20 million (thus, the total income that has not recorded into accounting books in 20 months, is up to over 10 billion VND- said by reporter).

"Binh Tay Packaging and Warehouse Joint Stock Company commits to pay taxes and remedy consequences according to the inspection results of HCMC Tax Department" - Director General of the General Department for Market Surveillance Tran Huu Linh said.

More than 30,000 infringing goods seized

On June 4, 2019, HCMC Market Surveillance Department worked with the Operational Department (under the General Department for Market Surveillance), the Standing Office of the National Steering Committee 389, Investigating Police Division on Corruption, Economic and Smuggling Crimes (PC03) under HCM City Public Security and the Public Security of District 6 in inspecting warehouses at 621 Pham Van Chi, Ward 7, District 6.

As a result, competent forces detected and temporarily seized many goods with signs of violations.

At a meeting with the Standing Office of the National Steering Committee 389 on May 14, 2020, the representative of Director General of the General Department for Market Surveillance said that through inspection, verification, the competent authorities identified violations related to trading smuggled goods, banned goods goods wihout origin.

So far, the competent authorities have fined administrative violations of organizations and individuals with the total amount of VND 328.5 million.

Notably, the volume of seized infringing goods is 30,613 products such as tea sets, stainless steel appliances, electronic products, electrical equipment of all kinds.

In adttion, the competent agencies destroyed 5,739 toy products.