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Gold miners yet to meet tax obligations

Tuesday, September 2, 2014
Experts are calling for stricter penalties on mineral exploitation enterprises, which have intentionally delayed the payment of environmental protection fees and taxes.

Chu Thuy Oanh, deputy director of the Taxation Department of the northern mountainous province of Cao Bang, said numerous enterprises have found excuses to avoid paying the fees and taxes as required.

Authorities inspect a gold exploitation site belonging to Nguyen Phat Trading and Mining Company in Pac Nam District in Bac Kan Province. The company is at the top of a list of enterprises delaying the payment of taxes to the tune of VND180 billion ($8.4 million)

Cao Bang is one of the provinces that have a wide variety of precious minerals, especially gold and ore. In recent years, a number of mineral exploiters have closed their mines. Some even declared bankcruptcy to avoid payment, Oanh said.

Oanh cited the regulation which allowed enterprises to pay taxes based on the principle of self-declaration of mining production. After a period of exploitation, a good number of mining companies declared bankruptcy to delay the payment. This is a form of fraud, she said.

Figures from the department showed at least 12 enterprises did not pay nearly VND26 billion (US$1.2 million) in taxes.

Hong Duc Tin, official of Ho An District's taxation division, said local mineral exploitation enterprises, mostly private, still owed more than VND1.5 billion (US$70845) in taxes to the District.

"They don't answer our calls whenever we phone them about the payment. They have yet to establish an account to which they can send the money even as they continue mining for minerals," Tin said.

Other northern provinces such as Bac Can, Yen Bai and Ha Giang have experienced the same situation. Bac Kan Province has 165 mines and quarries. Nguyen Phat Trading and Mining JSC has topped the list of enterprises which have delayed tax payment, with a total of VND180 billion ($8.4 million).

Nguyen Linh Ngoc, deputy minister of Natural Resources and Environment, said both the enterprises and concerned government agencies were responsible for the delay in the payment of taxes and fees. Ngoc blamed the low awareness of enterprises and loose management of government agencies, leading to a lack of strict penalties on enterprises, for the problem.

Ngoc admitted that the mineral exploitation industry had faced a number of difficulties in recent years, compelling some enterprises to find excuses to avoid their social responsibilities. However, loose management has made the situation worse, and even enterprises which are making profits have refused to pay.

Experts said strict penalties should be imposed on these enterprises. They also said the regulation which allowed enterprises to pay taxes based on self-declaration of mining production would lead to fraud and should be placed under tighter control
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