Strictly penalize businesses that violate tax laws.

(Baonghean)"We will investigate thoroughly if we find any businesses showing signs of violating the law..." - Mr. Vo Duy Duc, Deputy Head of the Vinh City Tax Department, affirmed. Recently, the Vinh City Tax Department has transferred files of businesses suspected of violating tax laws to the police. One business has been prosecuted, and several others are under investigation...

Tax officials inspect the headquarters of Mai Phuong General Trading Company Limited.

A business under scrutiny by law enforcement agencies has been identified by the Vinh City Tax Department as Mai Phuong General Trading Company Limited; business registration certificate number 2901553998 dated June 12, 2012, with the first amendment registered on July 2, 2012, issued by the Department of Planning and Investment. The company is managed by Mr. Bach Ngoc Minh (born in 1964). Located at house number 3, alley 5, Nguyen Tuan Thien street, Le Mao ward, the company specializes in trading in goods such as soil, stone, sand, gravel, and wooden molds. Based on the VAT tax declarations of Mai Phuong General Trading Co., Ltd. from June 2012 to November 2013, the Vinh City Tax Department discovered that this enterprise showed signs of engaging in unreasonable buying and selling practices when purchasing soil, stone, sand, and gravel from Hai Phong for business in Nghe An and Ha Tinh provinces. Upon checking input VAT, Mai Phuong General Trading Co., Ltd. declared 56 purchase invoices with a total value of goods exceeding 19 billion VND. Regarding output VAT, 513 sales invoices were declared. Of these, 409 invoices were from June 2012 to February 2013, with a pre-tax value of goods at VND 12,937,551,147 and VAT at VND 1,293,755,116. From March 2013 to November 2013, there were 104 invoices, with a pre-tax value of goods at VND 5,080,768,207 and VAT at VND 508,076,720.

To prove the violations, through the Ngo Quyen District Tax Office (Hai Phong), the Vinh City Tax Office repeatedly checked the information of businesses that had sold and transported goods to Mai Phuong General Trading Co., Ltd. in writing, requesting the business owner to provide explanations. In addition, they inspected and discovered that although this company traded in earth, stone, sand, and gravel, it did not have any warehouses, yards, or transportation vehicles. On December 20th and 23rd, 2013, the Vinh City Tax Office twice summoned the company director to the tax office to provide relevant documents, but Mr. Bach Ngoc Minh did not comply. Also on December 23rd, 2013, the Vinh City Tax Office received a notice of cessation of operations from Mai Phuong General Trading Co., Ltd., signed and stamped by Mr. Bach Ngoc Minh. On December 25, 2013, verification at the registered business address at No. 3, Alley 5, Nguyen Tuan Thien Street, Le Mao Ward, revealed that Director Bach Ngoc Minh was not present. The location was just a small house with no company sign, and only a person claiming to be an accountant named Bach Ngoc Tuyet was there. On January 5, 2014, the Vinh City Tax Department issued a notice regarding tax settlement, asset handling, and invoice cancellation for Mai Phuong General Trading Company Limited.

Document from the Vinh City Tax Department regarding the illegal use of invoices by Tan Ben Thuy Construction and Trading Co., Ltd. and Mai Phuong General Trading Co., Ltd.

The company being prosecuted is Tan Ben Thuy Construction and Trading Co., Ltd., tax code 2001569331; address at No. 3, Alley 60, Phuong Hoang Street, Block 5, Trung Do Ward; trading in construction materials; business registration certificate No. 290569331 dated August 23, 2012, with Tran Duc Chinh (born in 1980) as director. Tan Ben Thuy Construction and Trading Co., Ltd. is suspected of falsifying 36 input VAT invoices with a total purchase value of 34,334,120,171 VND, corresponding to a deductible input VAT of 3,433,412,017 VND. He fabricated 353 output VAT invoices with a total sales value of 34,412,936,869 VND, corresponding to an output VAT of 3,441,293,691 VND, and absconded with the invoices containing outstanding tax debts from his business premises.

To clarify the violations, officials from the Vinh City Tax Department, along with tax officials from the districts of Nam Dan, Hung Nguyen, Quynh Luu, Hoang Mai, Thai Hoa, Nghia Dan, and Nghi Xuan (Ha Tinh province), visited businesses to verify sales invoices of Tan Ben Thuy Construction and Trading Co., Ltd. They also coordinated with the Vinh City Police to verify the identity of Tran Duc Chinh in Quang Tri and Dak Nong provinces using information from his ID card. This revealed that Tran Duc Chinh – the Director of Tan Ben Thuy Construction and Trading Co., Ltd. – was a fictitious name; his real name was Tran Quang Phien. Taking advantage of the leniency of the law in business registration and the autonomy of businesses in printing and issuing invoices, Tran Quang Phien cunningly used a fake ID card to establish a business, trading in invoices for a short period of time, accumulating a large sum of money before absconding. In response to Tran Quang Phien's actions, the Criminal Investigation Department of the Vinh City Police... Vinh issued an arrest warrant for him on January 4, 2014. Following the clues, the Criminal Fugitive Apprehension Department of the Provincial Police determined that Phien was gathering money to prepare to flee to Cambodia. On April 1, 2014, he was arrested and transferred to the Vinh City Police for investigation.

According to Mr. Nguyen Viet Hung, Team Leader of Tax Inspection Team No. 2, who closely followed these cases, "The violations of these businesses are very clear. For Tan Ben Thuy Construction and Trading Co., Ltd., verification revealed that the business owner forged identity cards to establish a company for buying and selling invoices; inflated input invoices to claim input tax deductions, and created fictitious output invoices to collect output VAT amounting to nearly 3.5 billion VND. For Mai Phuong General Trading Co., Ltd., the purchase of soil, rocks, sand, and gravel from Hai Phong to Nghe An and Ha Tinh for business is extremely unreasonable, and this is the basis for our suspicion. Verification showed that this company used illegal invoices. Although Mr. Bach Ngoc Minh was arrested in February 2013, from March to November 2013, Mai Phuong General Trading Co., Ltd. continued to forge the director's signature, company seal, and electronic signatures to use and issue VAT invoices for large quantities and amounts." billions of dong... In response to these events, the head of the Sub-Department promptly transferred the files to the City Police, and at the same time reported to the head of the Tax Department for guidance...".

To date, the Vinh City Tax Department has transferred 148 business files related to tax arrears and businesses abandoning their premises while taking invoices with them to the Vinh City Police. In addition to the files of the two aforementioned businesses, there are also files of several other businesses that the City Tax Department has detected signs of legal violations. According to Mr. Vo Duy Duc, Deputy Head of the Vinh City Tax Department: "Taking advantage of the lenient legal regulations allowing businesses to independently print, issue, and use invoices, in recent times, many individuals have established businesses but not engaged in production or business activities; instead, they only trade in invoices. Therefore, in addition to relying on newly issued documents from the Ministry of Finance and the General Department of Taxation to strengthen the strict management of printing, issuing, and using invoices by businesses, we must pursue to the end those businesses showing signs of violations..."

Ha Giang