The Ministry of Industry and Trade headquarter in Hanoi (Photo: vietnamnet.vn)Hanoi (VNS/VNA) - Some Vietnamese exports have been investigated fororigin fraud and tax evasion, which requires tougher action from the VietnameseGovernment to settle the problem and keep its exports growing.
Accordingto the Trade Remedies Authority of Vietnam under the Ministry of Industry andTrade (MoIT), there were 15 tax evasion investigations on Vietnamese exportsbetween 2000-2016. Between 2016 and 2017, six companies were investigated.
Thenumber of cases targeting Vietnamese exports is forecast to increase becausefirms have begun shifting their production to Vietnam and the number ofsuspicious products has risen.
Theministry has recently sent a request to city/provincial people’s committees ofthe list of products at risk of investigation.
There arefour levels with the last two (level 3 and 4) being the most critical. Amongthe 13 listed products, hard-wood plywood is classified as level 4.
The USstarted investigating Chinese plywood items for anti-dumping and subsidy inDecember 2016 and officially imposed tariff on the products a year later.
Thedeclining amount of Chinese plywood exports has boosted Vietnam’s exports tothe US. That makes Vietnam a new target for the US anti-tax evasion campaign.
“The USCustoms and Border Protection have begun investigating Vietnamese plywoodexports so local authorities must tighten the control,” the ministry said inthe request.
Someforeign companies have tried to obtain Certificate of Origin (C/O) to exporttheir plywood products to the US and avoid tax.
In othercases, local firms have helped foreign producers cheat on US partners inplywood exports, Nguyen Ton Quyen, Vice Chairman cum Secretary General of theVietnam Timber and Forest Product Association, told Hai Quan (Customs)newspaper.
“Totalvalue of timber exports in 2019 is forecast at 11 billion USD, of which plywoodexports are valued at hundreds of millions of dollars,” Quyen said.
“Butorigin fraud must be dealt with to deter local companies and avoid potentialconsequences.”
Statisticsby the ministry show the US was Vietnam’s biggest export market in the firsteight months with total export turnover of 38.6 billion USD – up 25.3 percentyearly. It was followed by the EU (27.7 billion USD, down 0.5 percent) andChina (23.8 billion USD, down 2.5 percent).
Though Vietnamshould be happy with the increase, many experts have expressed concerns as thegrowth of the US market means more risky for the economy given the pressure ofthe US-China trade war.
Accordingto the European-American Market Department, the increase requires theGovernment to pay more attention to whether the products are actuallyoriginated from Vietnam or the companies just try to use the country to commitorigin fraud and tax evasion.
DeputyMinister of Industry and Trade Tran Quoc Khanh said investigations into Vietnam’ssteel exports may happen as well as other products such as textile andgarments, footwear and cashew.
To fightorigin fraud and tax evasion, the Government in July 2019 issued Decision824/QD-TTg to improve the State control over the origin of products, whichstresses the co-working between the Government, local authorities and thebusiness community.
“Managementmeasures must be improved to predict, prevent and deal with tax evasion andorigin fraud cases more seriously to keep Vietnam’s exports competitive,especially when trade protectionism has become dominant in many economies andthe US-China trade war has turned unpredictable,” Minister of Industry andTrade Tran Tuan Anh said.
Theministry will set up an inter-sector working team to review the policies andC/O regulations and upgrade penalties on origin fraud actions. The team willalso enhance the inspection of local production and export activities,especially towards the groups of product that are likely investigated fororigin fraud, Anh said.
Inaddition, the ministry will develop a co-working mechanism and constantcommunication between sectors, ministries, government agencies, localauthorities, business associations and banks, he said.
Businessassociations urged the ministry to finalise criteria on origincertificates and match them with international practices to boost Vietnameseexports in the global market.
They saidthe Government should diversify the export markets for local producers tolessen their dependency on some key markets. In addition, they suggestedMoIT simplify the procedures on C/O granting./.
Accordingto the Trade Remedies Authority of Vietnam under the Ministry of Industry andTrade (MoIT), there were 15 tax evasion investigations on Vietnamese exportsbetween 2000-2016. Between 2016 and 2017, six companies were investigated.
Thenumber of cases targeting Vietnamese exports is forecast to increase becausefirms have begun shifting their production to Vietnam and the number ofsuspicious products has risen.
Theministry has recently sent a request to city/provincial people’s committees ofthe list of products at risk of investigation.
There arefour levels with the last two (level 3 and 4) being the most critical. Amongthe 13 listed products, hard-wood plywood is classified as level 4.
The USstarted investigating Chinese plywood items for anti-dumping and subsidy inDecember 2016 and officially imposed tariff on the products a year later.
Thedeclining amount of Chinese plywood exports has boosted Vietnam’s exports tothe US. That makes Vietnam a new target for the US anti-tax evasion campaign.
“The USCustoms and Border Protection have begun investigating Vietnamese plywoodexports so local authorities must tighten the control,” the ministry said inthe request.
Someforeign companies have tried to obtain Certificate of Origin (C/O) to exporttheir plywood products to the US and avoid tax.
In othercases, local firms have helped foreign producers cheat on US partners inplywood exports, Nguyen Ton Quyen, Vice Chairman cum Secretary General of theVietnam Timber and Forest Product Association, told Hai Quan (Customs)newspaper.
“Totalvalue of timber exports in 2019 is forecast at 11 billion USD, of which plywoodexports are valued at hundreds of millions of dollars,” Quyen said.
“Butorigin fraud must be dealt with to deter local companies and avoid potentialconsequences.”
Statisticsby the ministry show the US was Vietnam’s biggest export market in the firsteight months with total export turnover of 38.6 billion USD – up 25.3 percentyearly. It was followed by the EU (27.7 billion USD, down 0.5 percent) andChina (23.8 billion USD, down 2.5 percent).
Though Vietnamshould be happy with the increase, many experts have expressed concerns as thegrowth of the US market means more risky for the economy given the pressure ofthe US-China trade war.
Accordingto the European-American Market Department, the increase requires theGovernment to pay more attention to whether the products are actuallyoriginated from Vietnam or the companies just try to use the country to commitorigin fraud and tax evasion.
DeputyMinister of Industry and Trade Tran Quoc Khanh said investigations into Vietnam’ssteel exports may happen as well as other products such as textile andgarments, footwear and cashew.
To fightorigin fraud and tax evasion, the Government in July 2019 issued Decision824/QD-TTg to improve the State control over the origin of products, whichstresses the co-working between the Government, local authorities and thebusiness community.
“Managementmeasures must be improved to predict, prevent and deal with tax evasion andorigin fraud cases more seriously to keep Vietnam’s exports competitive,especially when trade protectionism has become dominant in many economies andthe US-China trade war has turned unpredictable,” Minister of Industry andTrade Tran Tuan Anh said.
Theministry will set up an inter-sector working team to review the policies andC/O regulations and upgrade penalties on origin fraud actions. The team willalso enhance the inspection of local production and export activities,especially towards the groups of product that are likely investigated fororigin fraud, Anh said.
Inaddition, the ministry will develop a co-working mechanism and constantcommunication between sectors, ministries, government agencies, localauthorities, business associations and banks, he said.
Businessassociations urged the ministry to finalise criteria on origincertificates and match them with international practices to boost Vietnameseexports in the global market.
They saidthe Government should diversify the export markets for local producers tolessen their dependency on some key markets. In addition, they suggestedMoIT simplify the procedures on C/O granting./.
VNA
