Tax debts soar in HCMC
Tax debts soar in HCMC
The total tax debts of enterprises, mainly in the real estate sector, in HCMC surged in the first six months of the year, according to a July 20 review conference on tax collection in the first half of 2019.
Speaking at the conference organized by the HCMC Tax Department, Tran Ngoc Tam, director of the department, said that between January and June, the tax debt of eight firms increased to VND3 trillion.
Statistics from the municipal tax department show that real estate and construction enterprises took the lead among tax debtors. These firms’ tax debts reached VND2.4 trillion, accounting for some 52% of the city’s total recoverable tax debts.
Firms with high tax debt rise included the Phu Nhuan House Construction and Business Company, which owes a land use fee of VND1 trillion; the Saigon Development and Investment Corporation, which owes land rent fee of VND444 billion; and the Duc Khai Corporation, which has yet to pay VND389 billion.
In the first six months of the year, tax debts related to land jumped 155% against the figure seen in late 2018 to VND3.4 trillion.
Besides land-related tax debts, multiple firms were burdened with debts of other fees and taxes, typically environmental protection taxes on gasoline and oil. The Xuyen Viet Oil Travel and Transport Trading Company owed VND668 billion in environmental protection tax on oil and gasoline, while the Long Hung Trading and Service Company had a debt of VND243 billion as of May 31.
The debt in terms of unpaid taxes and fees in the city totaled VND6.4 trillion in the first six months of 2019, up 60.6% against the figure recorded in late 2018.
At the conference, Phi Van Tuan, the deputy general director of the General Department of Taxation, said that other cities and provinces were also facing the same problem as HCMC.
Economic growth is on the rise, but some sectors, such as property and construction, are slowing down, or even, have come to a standstill, causing many enterprises to run up debts in land use fees. In addition, many firms have accumulated serious debt in environmental protection tax on oil and gasoline.
“Some provinces saw a few firms owe VND400-500 billion of the environmental protection tax,” Tuan said.
The representative of the General Department of Taxation has proposed the HCMC carefully analyze and re-assess measures and governance of tax collection and the management of tax debts to minimize the volume of tax debts and make tax collection more efficient, according to VietnamPlus.
Apart from adopting more effective solutions, the municipal authorities have been asked to review key firms to urge them to pay debts, and to boost administrative reforms and modernize tax governance.
