Nguyen Kim dodged $4.58 million in taxes over past decade
18:51 | 10/07/2018 Print Article
Domestic electronic retailer Nguyen Kim, in which Thailand-based Central Group holds 49 per cent, has just been imposed an administrative fine and collected tax arrears of VND148 billion ($6.5 million).
|Ho Chi Minh City Tax Department decided to collect VND148 billion from Nguyen Kim. Photo: zing.vn |
Deputy director of the Ho Chi Minh City Tax Department Nguyen Nam Binh on June 29 signed the Decision No.3506/QD-CT to issue an administrative sanction on Nguyen Kim Trading JSC due to corporate income tax evasion. Accordingly, the Tax Department decided to collect arrears of VND104 billion ($4.58 million), a fine of VND19 billion ($837,000), and collect the leftover payment of VND24 billion ($1.05 million).
Previously, the Tax Department has received an unnamed complaint about Nguyen Kim’s tax dodging and carried out an inspection at the firm.
|According to the decision, the firm has to pay within 10 days after the decision was signed (June 29). However, to date (July 10), Nguyen Kim has not confirmed to VIR whether it paid or not. |
The inspection results show that over the past 10 years, Nguyen Kim has dodged corporate income tax by shifting its employees’ salaries and bonuses to allowances and overtime payments.
For example, managers receive a wage of VND50 million ($2,202), but Nguyen Kim only prepared income tax returns with the basic wage of VND12 million ($528), while the rest of the VND38 million ($1,674) was shifted to allowances (according to tax regulations, corporate income tax is counted after the normal eight-hour working day, and does not account for shift allowances).
Similarly, its employees’ quarterly and annual bonuses have also been shifted to allowances to evade tax charges. Thus, Nguyen Kim has not paid over VND100 billion ($4.4 million) in taxes.
Nld.com.vn quoted a number of Nguyen Kim employees as saying that the Tax Department’s inspection and tax collection are insufficient because since early 2014, despite not going public on the stock market, the electronic retailer has been rewarding employees with stocks at the price of VND50,000 ($2.2) per stock.
In addition, some employees have also complained that Nguyen Kim has not paid enough social insurance for its employees.
Nguyen Kim is a subsidiary of Thailand-based Central Group after the M&A deal in 2016. According to Ho Chi Minh City Tax Department, the tax evasion has been taking place since before the merger with the Thai firm.