Preventing risk of tax evasion from imported raw cashew

	Beware of the risk of tax evasion from imported cashew nuts
	Export of agricultural products is bountiful amid the siege of Covid-19
	Raw cashew nut imports rocket in first four months

Photo: Source: Internet

The General Department of Vietnam Customs said imports of raw cashew nuts from Cambodia have surged but those from Africa have plunged.

To strengthen origin inspection of imported raw cashew nuts and prevent fraudulent acts to enjoy special preferential tariff and other fraudulent acts, the General Department of Customs guided local customs department to identify and inspect imported raw cashew nuts.

Local customs department were assigned to randomly select about 10% of total imported consignments of the preceding month to conduct physical inspections.

If the imported raw cashew nuts are in accordance with the customs declaration and have the characteristics of cashew nuts that originated from Cambodia, Customs will conduct customs clearance and release the goods.

If the imported raw cashew nuts have certificate of origin form D of S granted by a Cambodian authority but have the characteristics of cashew nuts originated from Africa, local customs will send such cases to the General Department of Customs for investigation.

The General Department of Customs gave instructions to distinguish raw cashew nuts from Cambodia from cashews nuts from Africa.

In terms of colour, shape and size, Cambodian cashews have a deep dark brown colour, the raw cashews in the early crop are white and brown, even in size, are rounder than those from Africa.

African cashews are green-white or white in colour, uneven in size and flattened.

In terms of weight, Cambodian cashew nuts are about 170 nuts per kilo, with big nuts about 110 nuts per kg; medium-size nuts about 140 nuts per kg.

The weight of African cashews is large and small, ranging from about 140- 170 nuts per kg.

The characteristics of raw cashew nuts from Cambodia and from Africa are attached to this dispatch and update on the website of General Department of Customs. Local Customs Departments are asked to search the websites and guide their branches.

Regarding packaging, Cambodian raw cashew nuts are usually imported in bulk.

According to the General Department of Customs, the country imported about 330,000 tonnes of cashew nuts worth US$447 million, up 9.7% in volume and 10.3% in turnover compared to June 2021.

Thus, cashew nut imports have continued to see increases in recent months and by the end of July, the cashew imports exceeded two million tonnes worth more than $3 billion, up 160.2 % in volume and 207% in turnover year-on-year.

Although the turnover and volume of imported cashews in the seven months have far exceeded the results of the whole year of 2020 (in 2020, the whole country imported only 1,450,463 tonnes with a turnover of more than US$1.8 billion, down by 11% in volume and 17.1% in turnover compared to 2019).

Cambodia has experienced sudden growth and has become the largest supplier of cashew nuts to Vietnam.

In July alone, the volume of cashew imported from Cambodia was 79,740 tonnes, with a turnover of nearly US$135 million.

Accordingly, from January to July, Vietnam spent US$1,83 billion to import nearly 1.1 million tonnes, far exceeding the imports of the last year 2020.

Before the unusual development of raw cashew imports, the General Department of Customs took the initiative to gather information and offer solutions to investigate and handle violating enterprises.

Director of the Anti-Smuggling and Investigation Department said cashew nuts imported by business type from ASEAN have a 0% import tax, while those imported from non-ASEAN markets have a 5% tax rate. Thus, businesses "borrow" from the Cambodian market to evade import tax on this item.

Regarding fraudulent acts, traders often establish companies and comply with the law for an initial time to create trust. Then, they will massively import a large amount of goods and sell them in the country to evade taxes and the business owner will flee.

In addition, traders establish many "bogus companies" to make it tough for the authorities in investigation and settlement.

Cashew nut exports: Concerns about lower prices

Together with the involvement of the Anti-Smuggling and Investigation Department, the Post-Clearance Audit Department (General Department of Customs) planned to inspect 130 cashew processing firms with suspicious signs in some provinces. Through preliminary inspections of 30 companies, the customs officials found two enterprises showing signs of origin fraud and five showing signs of tax evasion.