Vietnam: Fines for acts of tax evasion in the field of customs

According to Article 31 of the Decree No. 128/2020/NĐ-CP of Vietnam’s Government, LAWNET would like to list the acts of tax evasion in the field of customs and the specific penalties of these acts in the article below.

Acts of tax evasion in the field of customs include:

1. Use of illegal or false documents to make tax declaration; making erasures or alterations on documents leading to understatement of tax payable or overstatement of tax exempted, reduced, refunded or canceled;

2. Incorrectly declaring codes of goods, tax rates or tax amount though instructions have been provided by the Ministry of Finance or the customs authority as prescribed;

3. The acts of making understatement of tax payable or overstatement of tax eligible for refund, remission or cancellation that are discovered during the inspection of goods granted customs clearance or discovered by the customs declarant himself/herself and he/she has adjusted the tax declaration dossier after the inspection conclusion is given but the offender fails to voluntarily take a remedial measure by fully paying the tax payable before the record on administrative offense is made. Including:

- Incorrectly declaring the quantity, names, categories, quality, customs values, codes, tax rates, tax amount and origins of goods (except for the acts of exporting or importing goods inconsistently with the customs declaration in terms of quantity, names and categories without any document for additional declaration in accordance with regulations of law on customs regarding additional declaration and, the acts of incorrectly declaring codes of goods, tax rates or tax amount though instructions have been provided by the Ministry of Finance or the customs authority as prescribed);

- Incorrectly declaring goods that are tax-free or exempt from tax or goods subject to tariff quotas;

- Providing incorrect information in the application for tax exemption/reduction/refund/cancellation or application for refund of overpaid tax/fine;

- Violating regulations on management of materials, supplies, machinery and equipment, processed products or domestic exports, thereby resulting in discrepancy between actual stock and values in accounting documents, accounting books or customs dossier on exports/imports other than the cases specified in Points d, dd, e and g Clause 1 Article 14 of Decree No. 128/2020/NĐ-CP;

- Violating against regulations on management of goods in a tax-suspension warehouse, thereby resulting in discrepancy between actual stock and values in accounting documents, accounting books or custom dossier on exports/imports other than the case specified in Point g Clause 1 Article 14 of Decree No. 128/2020/NĐ-CP;

- Preparing the statement in which the quantity of imported materials, supplies and parts used for production does not match the actual one.

- Declaring imported goods as processed abroad or domestic exports without a processor or manufacturer within the territory of the Socialist Republic of Vietnam; or without having machinery or equipment under the ownership or within the right of use at the manufacturing facility suitable for materials, supplies and parts imported for the purpose of processing and production of goods for export.

4. Failure to declare additional information about the customs value as prescribed is discovered during the inspection in the cases where the official prices of the goods are not available or goods for which the payment or goods for which payments and added amounts to the customs value are unknown when the customs declaration is registered.

5. Following procedures for exporting processed products; domestic exports; exports of an export processing enterprise without actually exporting them;

6. Overstatement of the quantity or categories of processed products; domestic exports; exports of an export processing enterprise; re-exported goods;

7. Failure to declare domestically purchased raw materials or supplies subject to export duty incorporated into the processed products for export; incorrectly declaring value of the exported raw materials, supplies or parts incorporated into the processed products, thereby resulting in the overstatement of tax exempted for the products processed overseas and then imported into Vietnam;

8. Repurposing goods which are tax-free, eligible for tax exemption, considered to be eligible for tax exemption or subject to tariff quotas without notifying the customs authority as prescribed;

9. Incorrectly declaring quantity, names, categories, quality, value or origins of goods imported from a free trade zone into the domestic market;

10. Failure to record the revenues and expenditures related to the determination of tax payables in accounting books;

11. Selling duty-free goods to ineligible buyers, in excess of the prescribed allowances or without satisfying conditions as prescribed by law;

12. Colluding with the consignor to import goods for the purpose of tax evasion.

Penalties:

The taxpayer that commits any of the offenses specified above which is not liable to criminal prosecution shall also incur a fine as follows:

- A fine equal to the amount of evaded tax if no aggravating circumstances are found;

- Every aggravating circumstance that is found will cause the fine to increase by 20% but not exceeding 03 times the evaded tax.

Fines for administrative violations for the above acts are applied to both individuals and organizations.

Remedial measures:

The violator is compelled to fully pay the outstanding tax if any of the offenses in this Article is committed.

Hai Thanh

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