Joint Circular No. 06/1999/TTLT/BTC-TCHQ guiding the handling of overdue tax debts, recovery of taxes, and late payment penalties for export duties, import duties, and special consumption taxes on imported goods.

JOINT CIRCULAR

Hguiding the handling of overdue tax debts, recovery of taxes, and late payment penalties for export duties, import duties, and special consumption taxes on imported goods,duties on importation, special consumption taxes on imported goods

In accordance with the directives of the Prime Minister in Circulars No. 1150/CP-TTH dated September 28, 1998, and No. 6430/KTTH dated December 15, 1997, regarding the recovery of export and import duties and the handling of overdue export and import tax debts, the Ministry of Finance and the General Department of Customs hereby provide specific guidance as follows:

I. HANDLING THE RECOVERY OF EXPORT AND IMPORT DUTIES

For all amounts of tax and fines that must be recovered, which were identified from customs declarations for exported and imported goods registered with customs authorities before October 15, 1998, shall be handled as follows:

1. In cases where the violations are due to the fault of the enterprise (including situations where the customs authority has inspected the exported and imported goods, calculated the tax, collected the tax, and the enterprise has sold all its goods and settled profits and losses), the customs authority responsible for the export and import procedures of the enterprise must recover the full amount of tax and fines according to current laws. Specifically, as follows:

- Misreporting the taxable value for export duties and import duties.

- Reporting incorrect names for actual exported and imported goods.

- Reporting incorrect quantities, types, grades, or origins of exported and imported goods.

- Failing to provide complete documentation related to exported and imported consignments as a basis for customs inspection or taxation.

- Other violations by enterprises leading to the recovery of taxes.

2. In cases where the reasons for recovery are due to external factors not attributable to the enterprise, such as unclear regulations, lack of detailed guidelines, or errors by customs officials..., the following measures shall be taken:

- The General Department of Customs will instruct local Customs Bureaus to review each specific case, clearly analyze the reasons for recovery, and compile all relevant documents to report to the General Department of Customs.

- Based on the results of the review and reports from local Customs Bureaus, the General Department of Customs will compile the information and propose recommendations to the Ministry of Finance for handling each specific case.

Customs officers who violate regulations causing loss to the state budget will be subject to disciplinary action according to the severity of their offenses as stipulated by law.

II. HANDLING OVERDUE EXPORT AND IMPORT TAXES

Overdue export and import taxes from declarations and tax notifications registered with customs authorities before October 15, 1998, shall be handled as follows:

1. For enterprises still operating but owing export and import taxes, the customs authority where the enterprise owes taxes shall require the enterprise to come forward to verify and confirm the amount of overdue export and import taxes. For enterprises that have been dissolved, merged into other enterprises, or split into multiple new enterprises, the receiving customs authority or the direct superior authority of the split enterprises must verify and confirm the export and import taxes with the customs authority. In cases where enterprises are split into multiple new enterprises, the verification statement must clearly indicate the names of the new enterprises responsible for paying the old debt and the specific payment terms according to each declaration of exported and imported goods. Based on the verification and confirmation of the debt, the customs authority will urge the enterprise to pay the overdue taxes into the state budget according to the prescribed regulations.

For enterprises that owe taxes but have been allowed by the Government and the Ministry of Finance to defer or suspend payments due to external factors, and whose deferral or suspension periods have expired, these enterprises must also verify the remaining debt and pay it into the state budget according to the prescribed regulations.

Any failure to pay taxes according to the prescribed regulations will result in enforcement actions according to current laws.

2. For enterprises that have been dissolved or declared bankrupt and are no longer operational, the superior authority or the authority issuing the dissolution decision shall instruct the Liquidation Committee of the dissolved enterprise or the Asset Settlement Team (for bankrupt enterprises) to settle the enterprise's outstanding debts according to the priority order specified in Article 39 of the Bankruptcy Law dated December 30, 1993, and Point 6, Section III of Circular No. 25-TC/TCDN dated May 15, 1997, issued by the Ministry of Finance on the procedures, formalities, and principles for financial settlement when dissolving state-owned enterprises.

If the remaining assets of the enterprise are insufficient to cover the overdue export and import taxes, the local Customs Bureau shall cooperate with the Liquidation Committee of the dissolved enterprise and the State Capital and Asset Management Bureau at the enterprise to inspect and submit a written report (with attached documentation) to the General Department of Customs by March 31, 1999, so that the General Department of Customs can propose recommendations to the Ministry of Finance to report to the Prime Minister.

For enterprises that are still operating but cannot recover their overdue export and import taxes due to force majeure, the People's Committee of the province (for local enterprises) or the central ministry in charge (for central enterprises) shall conduct a specific review of each case, submit a written report (with attached documentation) to the General Department of Customs by March 31, 1999, so that the General Department of Customs can propose recommendations to the Ministry of Finance to report to the Prime Minister.

3. For enterprises that still owe taxes on consignments entrusted for export and import by other enterprises, the following measures shall be taken:

3.1. In cases where enterprises still owe taxes on consignments entrusted for export and import by other enterprises, the customs authority where the enterprise owes taxes shall transfer the tax debt to the enterprise entrusting the goods for export and import for tracking and urging payment, provided there is a signed acknowledgment of the tax debt between the two enterprises for each declaration of entrusted export and import goods, and the entrusting enterprise must be authorized to directly engage in export and import activities.

The entrusting enterprise must also comply with tax payment requirements and will face enforcement if they violate, as stipulated in Section 1, Part II of this Circular.

3.2. In the case where the enterprise still owes taxes for consignment import and export shipments received on behalf of other enterprises, and the consigning enterprise for import and export has been dissolved or declared bankrupt, and the remaining value of the assets of the consigning enterprise is insufficient to cover the tax debt for the consignment import and export shipments, it shall be handled according to the provisions set forth in Section 2, Part II of this Circular.

4. For the amount of tax owed for temporary importation-reexportation shipments; imported raw materials for production of exported goods that have been re-exported outside the tax payment deadline permitted, the customs authority shall process the cancellation of the corresponding tax debt based on the quantity of goods re-exported. The procedures for considering the cancellation of the tax debt shall be carried out in accordance with the regulations on procedures for not collecting tax on temporary importation-reexportation goods and imported goods for production of exported goods that have been re-exported within the tax payment deadline.

III. HANDLING OF DELAYED PAYMENT PENALTIES

By October 15, 1998, if enterprises have completed payment of overdue tax debts for each customs declaration for import and export goods, then the enterprise shall be exempt from the delayed payment penalty corresponding to the amount of tax paid for each customs declaration for import and export goods.

The General Department of Customs directs and guides local Customs Bureaus to handle the procedures for exemption from penalties as stipulated above and to compile and report to the General Department of Customs, Ministry of Finance.

IV. OTHER PROVISIONS

I. Local Customs Bureau continues to process customs procedures for enterprises subject to compulsory measures in the following cases:

- Enterprises exporting goods to foreign countries.

- Enterprises importing raw materials, materials for production of exported goods or processing for foreign countries under signed contracts (except in cases where all products under the contract have been exported, the contract period has expired, and the customs authority has urged but the enterprise has not come to complete the tax settlement procedures; temporary import-reexportation business; transshipment).

- Enterprises owing overdue taxes (including arrears subject to recovery) who have registered a plan to pay off all tax arrears (with the deadline for paying off all overdue taxes before December 31, 1998. For enterprises with tax arrears exceeding VND 2 billion, the maximum deadline shall not exceed June 30, 1999) on a monthly basis with the customs authority where the enterprise still owes taxes and strictly implement the tax repayment plan registered.

2. During the implementation of the recovery of import and export tax arrears and the collection of import and export tax arrears, if any enterprise is found to intentionally delay or engage in actions obstructing the enforcement authorities with the aim of misappropriating state budget funds, the provincial and municipal Customs Bureaus shall prepare reports and submit them to the General Department of Customs for the General Department of Customs to report to the Prime Minister. Depending on the level of violation by these enterprises, administrative penalties or criminal liability may be recommended.

3. The handling of tax arrears, recovery, and delayed payment penalties for special consumption tax on imported goods shall also be implemented in accordance with the provisions of this Circular.

4. This Circular takes effect fifteen days after the date of signature. Any provisions contrary to the spirit of this Circular are hereby abolished.

The General Department of Customs directs local Customs Bureaus to uniformly implement the contents stipulated in this Circular.

During the implementation process, any difficulties encountered should be promptly reported to the Ministry of Finance and the General Department of Customs for timely research and resolution./.