PM orders review of Sabeco's US$136.1 million tax bill

Prime Minister Nguyen Xuan Phuc has asked the Tax Department of Ho Chi Minh City to hold back on enforcing a tax decision on collecting VND3.14 trillion (some US$136.1 million) from Sai Gon Beer-Alcohol-Beverage Corporation (Sabeco) for violations on special sales tax.

pm orders review of sabeco's us$136.1 million tax bill hinh 0
(Photo: enternews.vn)

This request was made in an express document of the Government Office signed by Minister-Chairman Mai Tien Dung on January 2.

“The Prime Minister is directing ministries and agencies to review the petition of the State Audit Office and the Government Inspectorate regarding the tax penalty for Sabeco. The Prime Minister ordered the Ministry of Finance and the HCM City People’s Committee to ask the municipal Tax Department not to compel Sabeco to pay this payment,” the document said.

According to the minister, tax enforcement on Sabeco involves foreign investment factor so the Prime Minister is very cautious, and during the time of considering this issue, there is no tax enforcement for the company.

“If handled quickly, it can affect the general investment environment of the country,” he told the media.

On December 28, Sabeco sent a document to the Prime Minister to call for help after receiving five decisions of the HCM City Tax Deparment to compel the company to pay the tax fines by taking money from the Sabeco’s bank accounts.

Sabeco has been requested to pay a total VND3.14 trillion for its monetary penalties and overdue payment for administrative violations on special sales tax during the 2007-2015 period.

According to the company, without the Prime Minister’s conclusion and a valid administrative decision, such an enforcement action contradicts the law.

Dung said after the Government Office collected the opinions of relevant ministries and agencies, the Prime Minister would preside over the meeting for advisory bodies to make proposal to deal with this case.

The market reacted negatively to this dispute.

Sabeco’s capitalisation has been evaporated by more than VND14 trillion (US$606.7 million) in the last two days after its shares, coded SAB on the Ho Chi Minh Stock Exchange, plunged by more than 8% from VND267,500 per share by the end of 2018 to VND245,500 on January 3.

Vietnam Beverage Co Ltd, a business related to ThaiBev’s billionaire Charoen Sirivadhanabhakdi, lost about VND7.5 trillion (US$325 million) as it owns more than 343 million shares, equivalent to 53.59% of Sabeco’s capital.

Ending September 2018, Sabeco reported net revenues of VND25.54 trillion (US$1.1 billion), up 8% year-on-year, of which beer sales accounted for 85% of total revenues. However, its net profit declined 6% to VND3.3 trillion (US$143 million).

Sabeco’s total assets increased by 4% to more than VND23 trillion (US$996.7 million).

VNS/VNA

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