Big businesses ask for tax leniency while exploiting every legal loophole Corporations have many methods to bleed the national budget’s dry: evading tax, declaring inaccurate taxable income, delaying tax payments, and committing trade fraud.   The Vietnam Coal and Mineral Industries Group (Vinacomin), for instance, has once again asked the state for tax and fee reductions on mined coal, citing huge losses due to overly high taxes and fees. Analysts, however, says that Vinacomin often asks the state to reduce its taxes and fees when it encounters difficulties. Last year, for example, the government cut the company’s coal export tariff to 10 percent from 13 percent, amid public opposition. Vinacomin enjoyed its tax cut, but the government had to raise export tariffs in an effort to restrict exports in order to store coal for domestic use. In late 2013, Vinacomin also asked the state for reduction and exemption of many kinds of taxes on their bauxite exploitation and processing projects in the Central Highlands, even though the company had been given many tax incentives. In another case last year, Vinashin, the shipbuilder, asked the state for VAT and import tariff cuts. Most recently, Vinalines, the shipping firm, has asked for preferential port fees. The loose management of state agencies has been exploited by enterprises seeking to squeeze money from state coffers. A number of fraudulent VAT refund cases, for instance, have been discovered recently, worth billions of dong in each case. In late 2013, the Kien Giang provincial police discovered fraud in a VAT refund case in one locality. A sum of VND109.4 billion had been refunded to a business declaring an export deal worth VND1.094 trillion, which they found existed only on paper. And in December 2013, HCM City police uncovered five cases of smuggling and tax evasion. Of these, the taxes appropriated by the Saigon Food Technology Company totalled nearly VND100 billion. Cao Anh Tuan, deputy general director of the General Department of Taxation, said that taxation bodies had inspected more than 39,000 businesses by the end of September, forcing businesses to pay VND7.4 trillion in additional taxes. Of the 39,637 businesses inspected in the first eight months of 2014, the taxation bodies found signs of transfer pricing at 1,938 enterprises. Not only have taxpayers been found breaking the law, but tax officers have also appropriated state money or lent a hand to taxpayers to commit fraud. In late 2013, authorities discovered that HCM City’s District 1 Taxation Sub-department had kept VND1.441 trillion worth of taxes in its coffers that should have transferred to the state budget. Ha Minh, VietNamNet Bridge