Quang Ngai Customs struggles with bad tax debts

	Tax sector dractically reduces tax debt
	Quang Ninh Customs recovers more than VND 1.5 billion of tax debt
	Bad debt may not be too serious

Quang Ngai customs officers inspect imported materials. Photo: T.H.

Only bank collateral assets left

According to Quang Ngai Customs Department, the total recoverable tax debtat the unit until November 30, 2019 is nearly VND32 billion. Although the unit has taken many measures to monitor and urgerecovery, at present these debts are completely unrecoverable due to many objective reasons.

Atypical case is the debt of over VND11.8 billion of Duc Pho Xanh Joint Stock Company at Dung Quat Port Customs Branch. The Branch applied coercive measures as prescribed, such as requesting Quang Ngai Tax Department to apply coercive measures by informing the invoice is no longer valid, the tax department said that this enforcement measure could not be implemented because the company has not registered the issuance and use of invoices at the tax department. The company has no assets other than the imported "machinery and equipment line for biological tablet production” to serve the Duc Pho Xanh Biological Tablet Production Plant project, which has been mortgaged at the bank with a value of over VND152 billion. The dispute between the plaintiff as a bank and the defendant as Duc Pho Xanh Joint Stock Company is being settled by Quang Ngai People's Court due to foreign factors. The Customs branch is working closely with the Court in debt recovery.

Similarly, for a debt of over VND11.8 billion (excluding late tax paymentinterest) of Son Ha Xanh Manufacture - Trading - Service Joint Stock Company, the branch has applied measures to collect the debt, but they proved ineffective. Through verification of the company's assets, this company also has the imported "machinery and equipment line for biological tablet production" to serve the Son Ha Xanh Biological Tablet Production Plant Project but it is being mortgaged at a bank.

Billions in debt but a few millions in account

In order to recover the tax debts, Dung Quat Port Customs Branch has applied many measures, including measures to deduct money from accounts, but they were ineffective because enterprises owe billions in debt and their accounts have a few million or are empty.

For example, the case of the tax debt of the Transpacific Service Co., Ltd. (now known as Petroleum Real Estate Joint Stock Company) with the amount of more than VND1.7 billion, from many years ago. After six changes, in July 2018, after the company has elected a new management board, Dung Quat Port Customs Branch has worked with the company’s representative to clarify the relevant issues and require the company to make the payment of tax debts, late payment interest and fines mentioned above. Up to now, the customs branch applied coercive measures to deduct the deposit to the state budget, but only collected VND1.5 million, the company still owes nearly VND1.7 billion in tax debt (excluding late payment interest as described). Recently, Dung Quat Port Customs Branch has applied the coercive measure of stopping customs procedures for this company.

For the debt of VND6.5 billion of SAPHIA International Joint Stock Company's branch in Quang Ngai province, Quang Ngai Customs Department has applied coercive measures as prescribed in Article 93 of the Law on Tax Administration. In particular, in September 2010, Quang Ngai Customs Department transferred the case file to the Police Department of Quang Ngai province to ask for coordination in debt collection, however, the police agency said that this case had no criminal signs. Quang Ngai Tax Department also announced that SAPHIA International Joint Stock Company's branch has left its business address. Quang Ngai Customs Department has applied the measure of deducting deposit account to the State budget, but as a result, it only collected over VND18 million.

In addition to the above debts, Quang Ngai Customs Department said that there are 13 cases of tax debts that are hard to recover. For this group of debt, the branch has reviewed and gathered information to determine appropriate measures. The branch has asked the Department of Planning and Investment of Da Nang City to issue a decision to revoke the certificate of enterprise registration for Doan Ket Production Trading and Services Co., Ltd., applied coercive measures to notify invoices which are no longer valid to Petroleum Telecom Land Joint Stock Company; verified the account information of 14 companies with tax debts at 47 credit institutions to have a basis for verifying information about the account balance to apply the measure of deducting deposit account into the state budget.

According to the leader of Quang Ngai Customs Department, most of the outstanding tax arrears at Quang Ngai Customs Department were from 2007 and earlier and all companies with tax debts have dissolved themselves, are no longer operating, at registered addresses, have no address, no property, do not report on tax, leads to struggle in the recovery, even unable to collect.