Strong customs valuation management performance brings benefit for enterprises

Mr. Tran Bang Toan, Deputy Director of the Import-Export Duty Department, General Department of Vietnam Customs

To improve the operation efficiency of customs authorities and service quality in customs valuation management, General Department of Vietnam Customs (GDVC) is developing a Project on the reform of customs valuation management to 2030 (referred to as the Scheme). Customs News conducted an interview with Mr. Tran Bang Toan, Deputy Director of the Import-Export Duty Department, GDVC to understand clearly this project after it took effect.

Can you evaluate how the customs valuation management has been implemented in recent years?

As a member of the World Customs Organization (WCO) and the World Trade Organization (WTO), since 2007, Vietnam Customs has fully implemented the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade GATT/WTO (referred to as GATT Agreement). GDVC has implemented valuation management reform schemes to gradually improve the legal documents system, the enforcement system and improve the capacity of customs officers specialized in the field of customs valuations.

On the basis of reform schemes, Vietnam Customs has carried out a series of activities such as; amending legal documents on customs valuation inspection in clearance, promulgating professional processes for customs valuation inspection during clearance stage, regulations on building and managing customs valuation database, establishing and training groups of experts on customs valuation ​​at customs departments of provinces and cities.

Through the management of customs valuation, the Customs authority has applied many inspection measures, contributing to step-by-step prevention of the phenomenon of trade fraud and tax loss for the state budget.

For enterprises, through the reform schemes, Customs authority has regularly organized training activities, dialogues and professional guidance for enterprises in the field of prices, helping enterprises to improve their capacity in determining and declaring the correct customs valuation of goods, avoiding errors that lead to violations and sanction, affecting the enterprises’ operation.

However, due to high flexibility and fluctuation in the price field, the work pressure of Customs officers on customs valuation inspection is increasing, affecting directly to service quality of the Customs for enterprises, so GDVC must take new actions to improve management efficiency and facilitate enterprises. The Ministry of Finance assigned the GDVC to study to promulgate and implement the Scheme within the framework of the Customs Development Strategy to 2030 approved by the Government. This reform scheme will thoroughly deal with the remaining problems and have long-term solutions to meet the requirements of modern customs management, digital customs, and smart customs in the future.

In your opinion, what solutions has the Customs sector come up with to ensure the effectiveness of this work?

To reform the customs valuation management to reach the world’s standards and appropriate to the actual conditions of Vietnam, the GDVC has researched and developed the scheme.

The scheme will continue to develop a customs valuation management system in line with international standards to ensure effective operation on the basis of a transparent policy system, comprehensively standardizing professional processes based on modern IT applications, contributing to facilitating lawful commercial activities, protecting the interests of the state, and the lawful rights and obligations of organizations and individuals.

What are the goals that the Scheme sets for the management of customs valuation in the coming time?

The scheme has been developed and consulted with the Ministry of Finance, customs departments of provinces and cities and professional units under the GDVC. The objective of the scheme is to evaluate all aspects related to customs valuation management, including current legal regulations; the organization and implementation in the Customs sector; the construction of a valuation database, information collection and processing; the coordination with agencies inside and outside the Customs sector.

It clearly stated the achieved results, shortcomings, limitations and causes; international experience, international standards and practices; proposes solutions to reform the management of customs valuation. GDVC will comprehensively reform the customs valuation management and launch support activities for the reform of customs valuation management from the stage of formulating and amending legal regulations; building a valuation database; information connection and exchange; organize the implementation of price management.

The project also aims to improve the quality of customs valuation management to meet the requirements of international integration in the context of applying modern technology and in line with the orientation of Customs Development Strategy to 2030, and the plan to hire IT services to implement digital customs. Ensuring effective operation of customs valuation management across all levels of management and in the coordination between customs management stages.

The Project will consolidate the organizational structure and strengthen the capacity of customs officers to perform customs valuation tasks in a professional, intensive, centralized and unified manner. Effectively building and operating a mechanism for information exchange and collection in order to build a complete and reliable database system on customs valuation; improve the effectiveness of the application of risk management techniques, digital technology and big data in customs valuation management.

Could you please tell us how effective is the project for the management and facilitating enterprises when it is approved? What will businesses receive if they comply with the law on customs valuation?

Vietnam Customs has made many efforts in reforming customs valuation management following the international standards, however, with the active development of the scheme to meet the new requirements of international integration and modernity, technology and e-customs, it will be an important step forward that brings positive effects not only to the customs authorities but also the business community.

When the scheme is approved and put into practice, the business community itself will see very clear benefits.

Firstly, it will reduce the inspection on customs valuation during clearance, helping to speed up cargo clearance. According to international standards, the enterprise is the person who determines and declares the customs valuation. The customs authority only performs preliminary inspection measures during the clearance stage. Most customs valuation inspections will be carried out in post-clearance audit stage. This helps businesses save clearance costs and increase profits.

Secondly, it will eliminate the imposition of customs valuation for enterprises.

Currently, Customs authorities are doing it in a way that if the customs authority rejects customs valuation declared by the enterprise, the customs authority will determine the customs valuation, impose taxes and handle administrative violations against enterprises. After implementing the Scheme, the customs authority will only determine customs valuation in post-clearance audit at the enterprise’s office, while in the clearance stage, the customs valuation determination is the responsibility and interest of the enterprise, Customs officers do not do it anymore. At that time, the enterprise will be paid tax into the state budget in accordance with the tax amount that the enterprise must pay.

Thirdly, Customs authority will establish a mechanism for enterprises to officially consult with Customs authority before declaring customs valuation. Through this mechanism, enterprises are directly guided by Customs officers on how to determine customs valuation of goods, declare the correct valuation, minimize the inspection in clearance, speeding up cargo clearance.

Fourthly, the Customs office will also regularly organize training programs for businesses to raise awareness of law compliance for businesses. The compliance incentive mechanism of the Customs authority even helps to affirm the enterprise's brand in the international market, indirectly supporting enterprises to increase import-export activities for further development.