Seal stamp on gasoline and petroleum to prevent loss of revenues

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Tran Hung Dao gasoline and petroleum station, Hanoi. Photo: Hong Van

Both enterprises and people support

When implementing the solution to seal master gauges at gasoline and petroleum stations against loss of tax revenues for State budget, the Ministry of Finance (MOF) said that the "stamp" will bring benefits to three parties: State, enterprises and consumers

According to Mr. Dang Ngoc Minh, the Deputy General Director of Taxation, in order to protect consumers and legitimate interests of enterprises, the rights and interests of the State, the MOF directed the General Department of Taxation to study measures in the effective management of tax on gasoline and petroleum business operation. After considering and studying measures of seal stamp on master gauges of gasoline pumps of pilot gasoline and petroleum stations in NgheAn and Lam Dong, the leaders of MOF assessed that this is effective and appropriate measure and directed to continue to diffuse and apply it nationwide.

For enterprises, the representatives of the General Department of Taxation stated that through surveys and direct working with the gasoline and petroleum enterprises which have large market share and many gasoline stations such as : Vietnam National Petroleum Corporation, Military Petroleum Corporation, PetrolVietnam Oil Corporation and Saigon Petro Co.,Ltd, these enterprises really support the stamping measure due to the fact that the stamping does not affect the business activity of the gasoline and petroleum stations and enterprises.

Mr. Nguyen Van Phung, Director of Tax Management Department for large enterprises said that the gasoline and petroleum business has many types of fraud, the Taxation are very concerned. The stamping on gasoline gauges at the gasoline stations will control the sold gasoline volume to prevent the case where the volume of gasoline is sold much, but the volume in the declarations is little. At the same time, preventing the sale of illegal invoices for enterprises

This is an effective measure in the current time to control the fraud in VAT declarations and use of gasoline tax invoices. Besides enhancing the State management and fighting the loss of tax revenues, the stamping on gasoline and petroleum gauges will contribute to prevent the business of smuggled gasoline and petroleum from unknown and unqualified sources in order to protect the consumer’s interests and create a healthy business environment.

Mr. Nguyen Van Phung added that the enhancement of management for this business activities not only increases the tax revenues but also ensure an equitable and healthy business environment against gasoline and petroleum smuggling across borders.

"In terms of trade exchange with other countries, the price of gasoline and petroleum of our country and other countries in the region is different. Our country has thousands of km of coastline, gasoline and petroleum trading activities take place not only in the land but also in the sea. Therefore, the Government and the MOF, as well as all levels and sectors, have issued a lot of measures to strengthen the management of gasoline and petroleum business” said by Mr. Phung.

e-invoices will be issued

As reported by the General Department of Taxation, up to now, there were 46 provinces and cities completing the stamping on master gauges at more than 10,0000 gasoline stations, corresponding to about 30,121 gas stations. The initial results showed that after stamping, the volume of sold gasoline and petroleum was increased so that the amount of environmental protection tax paid to the State budget also increased by 10% on average compared to the time when the stamping was not implemented.

Typically, some provinces such as Nghe An, after completing the stamping in November 2015, the volume of sold gasoline and petroleum and the amount of environmental protection tax in 2016 increased by more than 20%on average. This was the province which has 449 enterprises as agents, general agents and 514 stations of gasoline and petroleum with 1,501 gasoline pumps which were stamped to seal the gauges. In Quang Ninh, after completing the stamping in late November 2016, the volume of sold gasoline and petroleum and the amount of environmental protection tax also increased by an average of 15% every month compare to the previous time of stamping. Similarly, in provinces with large gasoline stores such as Thai Binh and Binh Dinh, the volume of sold gasoline and petroleum and amount of environmental protection tax increased by 14%; and in Lam Dong, the volume of sold gasoline and petroleum and amount of environmental protection tax also increased by 10% compare to the previous time of stamping.

According to the leader of the HoaBinh Tax Department, this is a measure to manage and increase budget revenues, as well as to create an anequitable playing field in the performance of tax obligations for the State. The stamping process has closely monitored and examined by the inter-branch delegation, especially the post examination after stamping o has been also paid attention to inspection and control to well manage the budget collection in this field. The process of stamping implementation at gasoline and petroleum stations realized that most business units have supported and created favorable conditions for the working groups to affix stamp as described

Sharing the measures of stamping on master gauges at gasoline and petroleum facilities, Mr. Nguyen Van Phung admitted that this is still manual method. However, in general, this is an effective and appropriate measure in the current context and needs to be drastically deployed in the coming years.

“In foreign countries, people pump gasoline by themselves due to the connection between the management agencies and business facilities. Thus, the State can implement strict management against the loss of revenues and difficulties in control. In our country, investment in equipment for management is not easy because there are not many companies which can afford to invest in technology. Therefore, although this measure is only temporary, it is the most effective and appropriate in the present time”

“As per representatives of the General Department of Taxation, the Taxation is formulating policies to apply electronic invoices for gasoline and petroleum business. So that anyone who buys gasoline is also invoiced(like buying goods in a supermarket), instead of taking a manual invoice and taking a lot of time like today. At the same time, the software management also updates retail data to the tax system for control. "In the long term, the Taxation expects that the gasoline and petroleum invoicing software will synchronously connect with Tax agencies, and daily sold gasoline data will run directly to the tax agencies. It is necessary to study and apply IT, and invest in equipment system and prepare legal basis to apply e-invoice to all the gasoline and petroleum stores, branches and enterprise, and connect the e-invoice data to the Tax agencies” Mr. Nguyen Van Phung shared.