Cars imported across HCM City Customs Port reduce over 50%. Photo:T.H

Reducing VND6,000 billion from imported cars

At the working session with Minister of Finance Ho Duc Phoc on June 14, Director of HCM City Customs Department Nguyen Hoang Tuan shared reasons for the State revenue reduction. Accordingly, the revenue from CBU cars declines 51.78% year-on-year due to the impact of tariff reduction commitments under Free Trade Agreements (FTAs).

The department said that Thailand and Indonesia are the two largest automobile export markets to Vietnam, accounting for about 80% of the market share with 0% import tax incentives under the ATIGA Agreement for the period 2022 – 2027 for CBU cars and auto components and spare parts.

In addition, the import duty on CBU cars imported from the EU to Vietnam will decrease by about 7%/ year under the tax reduction roadmap of the EVFTA. It is expected that by 2030, the import duty on CBU cars imported from the EU will be 0%.

The import and export turnover of petroleum products increases by 10.2% year-on-year, however the revenue only increases by about VND 0.73 billion due to the impact of import duty incentives from ASEAN market. Accordingly, instead of importing gasoline from Korea with a tax rate of 8%, and businesses switched to importing gasoline from ASEAN market with at 5% tax rate, DO oil and FO oil at 0% tax rate.

The import and export turnover from steel products rises 30.5% co compared to the same period in the previous year. However, the State revenue only increased by VND470.1 billion because the civil construction market has not really recovered, so the volume of inventory is large.

The department’s revenue is also affected by the policy of reducing the VAT rate by 2%. Accordingly, the VAT reduction facilitates enterprises but the revenue from VAT reduced VND2,000 billion in the first five months of the year.

In addition, the traffic system around the ports and the road system, especially the ring road system 2, 3, and 4 have not been completed, causing congestion on the road routes to Cat Lai port, Phuoc Long ICD, Tanamexco, and Transimex.

The construction activities of infrastructure projects have caused traffic jam and increased transportation costs due to the increase in fuel prices and road tolls... leading to the shifting of import and export goods to other areas.

8 solutions for revenue collection in the second half of the year

In 2024, HCM City Customs Department is assigned the revenue target of VND130,800 billion, increasing by 7.4% compared to the target in 2023. The department estimates the State revenue at VND127,050 billion, up 5% compared with the previous year.

In order to complete the revenue target, the department will implement 8 solutions in the second half of the year. The department continues to develop and deploy trade facilitation programs and plans in short term and long term to support enterprises to promote production, business, and socio-economic development.

The department plans to hold a Customs – Business dialogue conference on June 26 with about 300 delegates who are representatives of consulates, domestic and foreign business associations, and businesses that contribute the major revenue of the department to disseminate Customs policies.

Imported iron and steel is one of three commodity groups that greatly impact the state revenue of HCM City Customs. Photo: T.H

The Department proactively monitors, analyzes, evaluates and forecasts the revenue situation at the department to promptly develop specific action plans in each stage to achieve the highest revenue target.

In addition, the department will inspect, review and implement tax policies for exported and imported goods, especially tax exemption, tax reduction, tax refund, tax non-collection, and handling tax amount, late payment interest, overpayment fines at branches. It will promptly research and propose to handle arising problems, ensuring the implementation of tax policies in accordance with regulations and consistency in the whole Department.

The department will effectively follow the instructions of the General Department of Vietnam Customs on customs valuation, coordinate with customs branches to implement consultations and collect taxes quickly, accurately and effectively.

In addition, the Department also regularly reviews and inspects the classification and application of tax codes on goods during customs clearance and post-clearance audit, and focus on commodity groups with large turnover, green channel declarations, products instructed by the General Department of Vietnam Customs on results of analysis and classification, the same item but the code declared in different code or different analysis results to collect tax arrears due to incorrect application of codes, and prevent businesses from taking advantage of the openness of the law for frauds on condes and tax rates.

For post-clearance audit, specialized inspection the department strengthens information collection and analysis activities to detect signs of violations and risks; collect, review, and analyze data and information on items with high risks on value, origin, code and policies; focuses on post-clearance audit for high risk enterprises, complex import-export activities, production, business, and import in many different areas.