A gold shop in the Mekong Delta province of Ca Mau has filed an appeal against a local tax agency's decision to collect VND60 billion (US$2.8 million) that it allegedly evaded in 2010, a source told Thanh Nien Wednesday.
In his appeal, Nguyen Binh Khiem, owner of the Hoang Khiem Gold Shop, claimed that the decision of the Dam Doi District's Tax Agency was baseless.
The tax agency has estimated that the shop enjoyed an increase of up to VND7.712 trillion (US$366.6 million) in its sales within seven months between January and November 2010, but did not report it to local agencies.
However, Khiem said that in August, 2010 he had reported "critical changes" in the shop's sales but the agency did not change its tax collection policy.
Provincial inspectors, who detected the increase in sales in December last year after checking Hoang Khiem's invoices, said that the shop had told the Dam Doi District's tax office that its fixed monthly income was just VND714 million ($34,000).
Explaining why his shop was allowed to pay monthly fixed taxes despite fluctuating sales, Khiem said that in 2008, he had proposed that the agency imposes tax on the shop's sales, but the proposal was rejected.
According to Khiem, although the invoices showed a huge increase in the shop's sales, the profits were very low, because it only bought impure gold to process before selling to other businesses.
For every tael, the shop earned just VND25,000 ($1.19), so actually its profits were just between VND5-7.7 billion ($239,000-368,000) in the period under question, Khiem said.
Le Thanh Du, chief of the Dam Doi District's Tax Agency, told Thanh Nien on the phone that his office has received Khiem's petition, but insisted that their decision was right.
"Hoang Khiem shop was wrong, so it has to admit it; it cannot put the blame on the tax agency," said Du, who was previously accused by provincial inspectorate of helping the shop evade the huge taxes by failing to properly inspect its operations.
Inspectors also said that Dam Doi's tax agency violated laws when imposing fixed taxes on Hoang Khiem when its sales were not stable.
The case is being investigated by Ca Mau police who stepped in early last month.
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