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One and all businesses evade tax, national purse torn

Big enterprises have been found as evading tax--foreign invested enterprises were involved in transfer pricing scandals, while state owned economic groups repeatedly insist on tax exemption and reduction.

VietNamNet Bridge – Big enterprises have been found as evading tax--foreign invested enterprises were involved in transfer pricing scandals, while state owned economic groups repeatedly insist on tax exemption and reduction.




The HCM City Taxation Agency has forced 11 big businessmen to pay the personal income tax arrears worth up to 10 billion. The “big guys” forgot some items when declaring tax in 2011, while the “mistake” was only found in July, or 1.5 years later.

The businessmen include a trader, who was asked to pay the tax arrears of VND2.2 billion. Each of the other five had to pay some VND1.5 billion, and each of the remaining five in the list VND500 million.

The tax sums that the “big guys” forgot to pay are hundreds of times higher than the income of normal workers.

A lot of showbiz celebrities were also listed as the tax evaders, who tried to evade several billions of dong in personal income tax. The “stars” have only accepted to pay the tax arrears after the taxation bodies showed the figures to prove their behavior of tax evasion.

The taxation agencies last week stirred up the public again when naming a series of businesses which evaded hundreds of billions of dong worth of tax.

The Binh Minh Plastics Company, for example, has been fined and asked to pay VND117 billion worth of the corporate income tax. The company declared the 50 percent tax reduction though the grace period for it ended already.

Tens of other big businesses, including the Song Da JSC, Sao Vang Rubber Company and Chuong Duong Drinks Company, have also been requested to pay tax arrears worth billions of dong for each.

Not only private, but state owned enterprises also committed tax frauds. The State Audit in April found that petroleum importers evaded VND470 billion, of which Petrolimex, the “eldest brother” with 60 percent of the market share, evaded VND170 billion, or 40 percent.

The Electricity of Vietnam (EVN) also bears the ill fame of evading tax, though the tax arrears it had to pay is not big, only VND1 billion worth of import tax.

Foreign invested enterprises seemingly cause the biggest headache to tax officers. Some transfer pricing affairs worth trillions of dong have been discovered.

The South Korean invested Keangnam Vina, the owner of the Vietnamese highest building in Vietnam, has admitted its transfer pricing behavior valued at VND1.22 trillion and has to pay the tax arrears of VND95.2 billion.

Meanwhile, a Malaysian – Taiwan textile joint ventures has been forced to pay the tax arears of VND78 billion after it was found as carrying out transfer pricing worth VND1.2 trillion.

122 foreign invested enterprises have been named in the “black list,” including the worldwide known names such as Adidas, Metro or Coca Cola.

The other enterprises don’t commit tax frauds, but have been insisting on tax remission, though they know well about the state budget shortfall.

The Vietnam Coal and Mineral Industries Group, for example, has asked to reduce the environment fee by 10 times and halve the coal export tax.

The Vietnam Shipbuilding Industry Group (Vinashin) has proposed to reduce the VAT, import tariff. Most recently, the Vietnam National Shipping Lines has asked for the preferential port fees.

Pham Huyen


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