Five enterprises suspected of misleading authorities as to content of billets to avoid higher tax rates.
Deputy Minister of Industry and Trade Cao Quoc Hung has signed a decision to establish an inspection team to exam alloy billets that contain boron and chrome.
The inspection team will include members from the Department of Heavy Industry, the Department of Science and Technology, the Import-Export Department, and the Market Surveillance Agency under the Ministry of Industry and Trade (MoIT), and representatives from the Ministry of Finance, the Ministry of Science and Technology, and the Vietnam Steel Association.
Local media has reported that five companies will be inspected: the Tan Thuan Industrial Promotion Company, the Duong Tien Co., the Vinh Long Co., Vinakyoei, and the Thep Uc Company, from November 19 to 23. The results will be forwarded to the Prime Minister on November 29.
Under the decision the inspection team will exam all categories and purposes of alloy billets imported in 2015, as determined by documents certified by MoIT, and also the infrastructure and machinery of factories using the imported billets.
On October 13 the Chairman of the Vietnam Steel Association (VSA), Mr. Ho Nghia Dung, notified MoIT that many Vietnamese enterprises had imported large quantities of Chinese alloy billets.
He alleged that a number of enterprises had mislead authorities by stating that the proportion of chrome in the alloy billets was only 0.3 per cent, so they could would be subject to zero tax rates. If the chrome content is actually higher they would be subject to a tax rate of 9 per cent. If proven to be the case, the practice would have resulted in the State budget losing $1.89 million.
It would also have resulted in enterprises that paid the full and proper rate struggling to compete with products made by those who falsely stated the content level. Vietnam’s steel industry only operates at 60 per cent of capacity because its products are difficult to sell.