VietNamNet Bridge – The taxation bodies have requested coffee enterprises to reimburse the VAT refund and reduced the tax deductions of hundreds of billions of dong.

Just after the 2014 New Year holiday, a complaint about the unreasonable request on the VAT refund reimbursement has been lodged to the watchdog agencies by six leading coffee export companies.

The companies, four domestic, namely 2-9 Dak Lak, Phuoc An, Anh Minh, Intimex Branch, and two foreign owned, namely Dakman Vietnam and Olam Vietnam, are all headquartered in Dak Lak, the coffee metropolis of Vietnam.

The six businesses affirmed that they have always been strictly following the current regulations on tax payment, invoices and accountancy mechanism. All their documents were carefully checked by tax officers before they got the tax refunds in accordance with the laws.

However, the businesses have been requested to pay back tens of billions of dong worth of VAT refunds,  just because they once did trade with some companies named in the taxation bodies’ black list. One of the companies in the black list is Phuoc Bao Trade Company Ltd.

Meanwhile, the VAT refund has been paid by the coffee enterprises to the sellers.

“The unreasonable request on paying back the VAT refund has pushed us against the wall. We are now on the verge of bankruptcy,” the letter of complaint reads.

According to the Dak Lak provincial Taxation Agency, the six “big guys” have been asked to pay back VND56.8 billion worth of VAT refund in total, while the tax agency has decided to reduce the tax deductions of over VND2.5 billion.

Especially, Anh Minh Company Ltd has been told to pay back VND22.4 billion.

The problem originated from the fact that in 2012, coffee enterprises in Dak Lak and some other provinces signed a series of contracts on buying coffee from Phuoc Bao, Phat Dai Long, Song Long Dat, Hong Minh Dat Companies.

After showing lawful documents, the coffee enterprises got the VAT refund from the taxation agency.

In late 2013, after discovering a lot of “bogus” companies, which made the corrupt use of the legal loopholes to appropriate hundreds of billions of dong, the taxation agency then joined forces with the local police to look for the criminals.

The taxation agency, after discovering a lot of the invoices relating to the bogus companies, has released a series of decisions on taking back the VAT refund. Other drastic measures have also been taken to serve the investigation process.

According to Bui Van Chuan, Deputy Head of the Dak Lak provincial Taxation Agency, the agency has to make such decisions--following the Ministry of Finance’s documents requesting to tighten the refund control in order to prevent criminals from appropriating the state’s money.

However, while the taxation body tightens its control to protect the state’s purse, it has put big difficulties for enterprises.

Do Quyet, Deputy General Director of Simexco, said he would fight to the last breath for the taxation agency’s removal of the request on the tax refund.

Tien Phong