Tax fraud by export enterprises is mainly at the intermediary stage, or setting up a chain of companies under someone else's name and using illegal invoices, according to the tax authority.
This information was announced by the General Department of Taxation after reviewing and inspecting enterprises exporting wood, forest products, and rubber with high tax risks.
Accordingly, tax authorities discovered many cases of fraud and appropriation of value-added tax (VAT) refunds. The tricks and behaviors of tax refund fraudsters mainly occur at the intermediary stage of buying and selling goods, because the direct purchase from growers has not been processed or pre-processed, so it is not subject to VAT.
At this stage, the traders create fake lists of purchases directly from growers and breeders or buy and sell illegal invoices to deduct taxes and legitimize floating goods. Thanks to that, subjects do not have to declare and pay VAT (5%). A number of cases of fraud and appropriation of VAT refunds were handled by tax authorities and functional forces in Phu Tho, Ninh Binh and Vinh Phuc.
The tax authority also mentioned the case of some subjects setting up a chain of businesses for relatives or relatives or hiring a legal representative, then buying and selling around and using illegal invoices for legal purposes. input chemistry. There are also cases where tax refund businesses use illegal invoices, when purchasing invoices from units that have no operations, abandoning business addresses or changing operations in many localities.
Also according to the tax authority, some intermediary businesses, after issuing invoices to export companies, stop doing business or flee. The declaration of revenue and taxes between intermediary companies does not match, when the seller declares small revenue but the buyer declares large input tax deductions. Payments via banks at these businesses also show signs of risk, such as transactions taking place within one day and the same person withdrawing money.
Through reviewing 120 intermediary businesses, the tax industry discovered that 92% of them abandoned their business locations, stopped operating, and are waiting for dissolution, according to the General Department of Taxation. "This is a problem that puts pressure on the budget when taxes have not been collected from these businesses, but taxes must be refunded to the units at a later stage," the General Department of Taxation stated.
However, the delay in tax refunds for businesses causes them to encounter many difficulties. Reporting on thematic monitoring of value-added tax (VAT) refunds, the National Assembly's Finance and Budget Committee said that from the end of last year until now, associations have continuously called for help because of unreasonable practices. This tax refund exam. Many wood, paper, and rubber businesses said that being "detained" thousands of billions of VND in VAT refunds for a long time left them exhausted and at risk of bankruptcy.
Explaining the slow processing of tax refunds, the tax authority said it also encountered many difficulties in processing documents because determining the amount eligible for tax refund must be based on the results of verifying whether the purchase or sale of goods is real or not. For example, in the case of a tax refund request for cassava starch, the tax department must verify it abroad. The tax authorities of the countries responded that the importing enterprise did not exist or did not acknowledge having transactions with Vietnamese partners. Therefore, it is impossible to refund taxes to businesses because the export contract is invalid.
According to tax industry statistics, in the first half of 2023, the number of tax refund applications in the field of wood and wood products reached 85%, down 5% compared to before; rubber decreased by 36-38%. There are 48 tax records that have not been refunded, accounting for 34% of the total business records requesting tax refund.
To increase management and combat tax fraud, the General Department of Taxation said it required local Tax Departments to strengthen control and coordinate with authorities to clarify the legality of documents with tax refund risks. This agency also reviews regulations on tax refund procedures, avoiding creating loopholes to take advantage of profiteering and tax fraud policies.
