The collection and analysis of information and professional inspection and control measures play an important role in helping the Customs authorities recognize the signs of enterprises at risk of escaping anddisappearing, preventing the risk of loss of State revenue.

Dong Nai Customs officers check an imported machine line. Photo: N.H 

Potential risks

According to statistics at Dong Nai Customs Department, there are currently more than 1,300 foreign-invested enterprises (FDI) carrying out procedures at Dong Nai Customs. In particular, 41 enterprises have escaped, disappeared or stopped operating, leaving large tax debts, many of them have been suspended for many years on the tax administration system of Dong Nai Customs Department.

According to statistics, the rate of tax debt of the enterprisesdisappearing and escapingfrom business registration addresseson the total amount of non-recoverable tax debts of Dong Nai Customs Department has increased over the years, from 44% in 2017 to 71% in 2018 and 73% in 2019.In addition to tax debts, the enterprises also have other debts such as wages of workers and social insurance debts, having a great impact on economic security and order in the locality and making it difficult for management units.

Actual management at the Dong Nai Customs Department has shown a number of causes leading to the escape and disappearance of enterprises. Accordingly, due to economic difficulties or prolonged crisis, enterprises did not survive, so they escaped the country. Besides, many enterprises had their expectations of profits from establishment time, they ran away due to being unprofitable.

In addition, some enterprisesdounfair business activities,aiming to profit to raise capital. When achieving the purpose, they escaped. Another reason is that the regulations on establishing enterprises are too easy, such as not needing legal capital and actual charter capital, but only making commitments to have sufficient capital when conducting production and business activities and there are not regulations as well as sanctions to check capital contributions.

Identifying enterprises at risk of escaping and disappearing

At the Dong Nai Customs Department, enterprises at risk of escape and disappearance often have some common signs, such as enterprises do not invest in capital construction and create fixed assets (do not have a head office), they only rentworkshops of other enterprises for a short time to operate; enterprisesoperate in the field of processing, manufacturing for export to foreign partners (raw materials at the import stage are exempt from tax).

In addition, some enterprisesimporting processing, manufacturing for export which the export volume according to the settlement report is much lower than the import amount or the enterprise imports large quantities of unsuitable raw materials and accessories which are not suitable to their capacity.

The abnormal increase or decrease in import and export activities is also a sign the enterprise is likely to escape or disappear, namely: the enterprise does not open the import and export declaration form, stop customs procedures in 3- 6 months;the enterprises have not exportproductsafter 4 to 5 months from the time of importing goodswhich are raw materials, supplies of processing contracts, and raw materials imported for manufacturing export goods.

In addition, there are some other signs such as: enterprises re-exporting machinery, equipment and materials without good reason; enterprises changing their address of production and business without notifying the Customs office.

Some other enterprises showed misconduct in reporting such as not submitting final settlement reports, liquidity records, plans for handling excess raw materials, supplies, machinery and equipment when the processing contractsexpired; failing to submit annual settlement reports on goods imported for export production within the prescribed time limit; not to submitsettlement reportsof duty-free imports (machinery, equipment or goods).

Along with that, enterprises are still in arrears, have overdue tax debts; enterprises have carried out the customs procedures; enterprises export irregularly, operate moderately due to difficulties of ordersare at risk of escaping or disappearance.

Some other signs such as enterprises owing insurance money for many months; tax arrears, fines of late payment interest for inland tax authorities; enterprisesdo not submit operation reports to business registration offices, Department of Planning and Investment of Dong Nai Province, Management Board of Industrial Zones of Dong Nai Province.

There are also cases where enterprises often owesalaries, strikes of theirworkers often occur, have a notice of sale of properties, workshops, machinery and equipment on the media;legal representative of the enterprise leaves the country,cannot be contacted or is prosecuted or arrested.

Strengthen inspection and control

To identify the signs of enterprises at risk of escape or disappearance, thereby preventing the loss of State budget revenues,the Customs officesshould enhance the collection, analysis and processing of information,identify enterprises at risk ofescape or disappearance.

At the same time,inspect the processing, manufacturingfacilities,processingand manufacturing capacity at the enterprise,including: checking the manufacturing facilities,collecting information, evaluation documents, machinery and equipmentcapacity; analyze and evaluate the results of inspection of production facilities, propose the application of handling measures.

Along with that, the Customs authorities also need to implement professional customs control measures to detect the situation of escaping and disappearing enterprises. Post-clearance inspection should also be promoted. In particular, focus on reviewing, identifying enterprises with suspicious signs included in the post-clearance inspection plan; check actual norms;check the situation of inventory of raw materials,supplies and exported goods.

At the same time, build and implement the process of checking, verifying and handling assets when enterprises escape and disappear.