Auto parts importers evade tax

The Ministry of Finance is seeking to retrieve unpaid import taxes on automobile parts imported between May 2010 and August 2011.

The ministry alleges that some enterprises during that period evaded paying the 27-per-cent import tax on auto parts by declaring to customs that parts were components for assembling completed automobile units and therefore qualified for a zero-per-cent tariff.

The General Department of Customs, detecting the tax evasion, has retroactively levied penalty tariffs of 77-82 per cent on the parts in questions.

The ministry said there were five automotive parts firms found to have violated the import tax regulations and that unpaid taxes would be collected upon full investigation by relevant agencies.

The situation of wrong customs declaration was due to lower import tax rates for separate auto parts against completed units of auto, said the ministry.

Meanwhile, auto producers were urging authorities to review existing regulations on auto parts tariffs, asserting that existing tax rates were outdated.

Prices of imported automobiles have increased by an average 10 per cent this year, according to dealers, with many small auto importers ceasing imports altogether because of Circular No 20 issued by the Ministry of Industry and Trade, which required importers to obtain certificates of warranty and maintenance from the Ministry of Transport.

The circular has cut heavily into the supply of imported vehicles on the domestic market, said Dai Do Thanh Co director Nguyen Thanh Hoang. Monthly imports of completely built units fell from 3,000 units to 1,000 units between June and July, according to the General Statistics Office. — VNS

Tags: Vietnam automotive, Vietnam automotive industry, Vietnam autos market, Vietnam car imports