Vietnam Custom: Great Contributions for Socio-Economic Development

Since the then Minister of Home Affairs Vo Nguyen Giap signed the Decree No. 27/SL dated September 10, 1945 to set up the Department of Tariffs and Indirect Taxes, the Vietnamese customs sector has consistently developed and fulfilled all assigned tasks. The sector has received uncountable recommendations and rewards, including the Ho Chi Minh Medal, from the Party, the Government and State.

 

The Vietnamese customs sector carries out the State management on imported and exported commodities, transport means for commodity exit, entry and transit and implements import-export taxation policies. Since 1992, the proportion of taxes collected from import-export goods has regularly stood at between 26 and 31.1 per cent. Taxes and other charges make up for over 95 per cent of the total State Budget collection. These figures show the great efforts of the customs sector in securing the stability of the state budget collection and helping boost the development of the national economy. The sector also plays an active part in orienting investment trends, stabilising market prices, expanding international exchanges and cooperation. The overall, strong and continuous reform will continue being imposed on customs procedures to meet higher requirements in service quality and quantity.

 

During the international integration, the Vietnamese customs sector has made remarkable progresses. On July 1, 1993, the sector became a full member of the Customs Cooperation Council (CCC), which is currently the World Customs Organisation (WCO). It joined the Kyoto Convention on Simplification and Harmonisation of Customs Procedures in 1997, the International Convention on Commodity Description and Coding System (HS Nomenclature) in 1998 and many other international treaties, contributing to the acceleration of integration processes of the Vietnamese economy, trade and tourism.

 

To meet international economic integration requirements, the customs sector as well as other sectors must carefully prepare. In particular, a well-trained and experienced workforce will play a crucial role in the success of the integration process. After the Law on Customs took effect, the customs sector has reshuffled its organisation apparatus, including removing unnecessary intermediary processes and sending 714 indirect staff to border gate offices. The sector has also classified levels of its staff in order to drill and supplement professional knowledge, especially those relating to HS, GATT, Kyoto and cetificate of origin (C/O) professions, aiming to modernise the customs sector to international level.

In the combat against offences in the customs system, the General Department of Customs has issued the Decision No. 1722/TCHQ-GSQL dated April 19, 2004 on strong disciplines to force all customs officers to wholeheartedly carry out their tasks and ban them from refusing legitimate requests of enterprises. Customs officers are obliged to enter pledge resolving dates when they receive documents from enterprises. The director of the General Department of Customs also issued Instruction 03 on strengthening administrative discipline and rules in the customs sector, promulgated, and Decision No. 517/QD/TCHQ/TCCB on eliminating red tape. At the same time, the General Department has also required directors of provincial and municipal customs departments to remove overlapping supervision procedures and specify certain officers who are allowed to contact enterprises and settle customs procedures. On October 6, 2004, the General Department issued the Statute on Investigation and Checking to promote self-examination and crosschecking. In November 2004, the Ministry of Finance promulgated the Decision providing a responsibility mechanism for customs officers. Hence, together with the issuance of policies and regulations on management and training of customs officers, the quality of human resources is improving and is ready for the integration process.

 

Although the Customs Law 2001 has created favourable conditions for the development of import-export activities and foreign direct investment and expansion of publicity, transparency and simplicity of customs procedures to speed up customs clearances, there is a gap between the customs sector and enterprises, such as disputes in coding system and taxation on certain goods, and malpractice among customs officers. In the meantime, some enterprises have tapped this easy mechanism to gain more fraudulent profits, or abuse incentives to smuggle and evade taxes. Some enterprises and officers do not completely understand the law or customs regulations. Some enterprises have asked for deferred tax payments and then removed business addresses. In order to facilitate customs procedures for enterprises, sweep away shortcomings and unify customs formalities and taxation policies, the National Assembly passed the amended Customs Law on May 25, 2005 and ratified the amended law on import and export taxes. The amendments to these two laws, effective on January 1, 2006, is the legal foundation for the customs sector and enterprises to disentangle the above shortcomings and create a more favourable environment for import-export activities. However, in my opinion, it is important to disseminate the new laws to customs officers and business communities through the mass media and drilling courses. It is also important to heighten the skill levels and knowledge of customs officers and organise exchange talks between customs offices and enterprises. Collected ideas from these talks would help the sector to build better management mechanisms and make appropriate amendments to the Law on Customs and related regulations. The sector should closely cooperate with VCCI, business associations and professional societies to boost exchanges between the sector and the business community. These will help the two sides fill the gap in understanding and implementation of customs procedures and regulations. As for enterprises, they need to be self-conscious and take initiative in researching and improving their ability and knowledge to catch up with the new law and related regulations. They should also observe the law in its entirety, paying all kinds of import-export taxes in full. Enterprises should raise their voices about shortcomings of customs regulations and import-export policies to help competent bodies make amendments and remove red tape which hinders customs procedures. Currently, we are experimenting with e-customs clearances in Haiphong and Ho Chi Minh City to clarify and minimise administrative procedures. The superiority of the new customs clearance method encouraged enterprises to connect with e-transaction.

 

With above preparations and activities, I strongly believe that the gap between the customs sector and enterprises will be removed in the near future, benefiting both enterprises and the State.