Tax evasion by a few millimeters, cheap steel floods into Vietnam

Just a few millimeters of difference in tax regulations has opened a “detour” for hundreds of thousands of tons of cheap hot-rolled steel (HRC) to flood into Vietnam. While domestic enterprises are struggling and unable to compete, the state budget has also lost more than 2,300 billion VND.

One of the shipments of wide-gauge steel imported to Vietnam - Photo: NN

In order to limit the flow of cheap steel into Vietnam, from February 2025, the Ministry of Industry and Trade began imposing anti-dumping taxes of 23.58 - 27.83% on hot-rolled coil (HRC) with a width of less than 1,880mm. However, just a few months later, large quantities of HRC steel with a width of 1,880mm or more began to be imported.

According to customs statistics, in the first 6 months of the year, Vietnam imported nearly 650,000 tons of this type of steel from China, 15 times higher than the same period in 2024.

In June alone, imports reached 215,000 tons, up 26 times over the same period. It is worth noting that the figure of 1,880mm is not a mandatory technical limit but an administrative tax threshold.

This means that if the steel is just a few millimeters "over the barrier" in width, importing businesses can completely avoid anti-dumping taxes.

According to industry insiders, the volume of imported wide-gauge HRC steel is currently 1-2 million VND cheaper than domestically produced steel, causing domestic manufacturing enterprises to suffer.

Although this type of steel is legal on paper and meets production standards, due to the specific size when imported, its proper and effective use requires machinery with significant design in terms of function, distribution channel or customer.

In essence, this is still a product that needs to be taxed but "escapes" the fence legally thanks to... a few millimeters.

According to experts' calculations, if the above-mentioned wide-gauge steel were also subject to the same tax rate as narrow-gauge steel, the state budget would have collected an additional 90 million USD, equivalent to 2,300 billion VND.

Dr. Hoang Ngoc Thuan, Foreign Trade University, assessed that the phenomenon of massive imports of wide-gauge steel right after the imposition of trade defense measures is a typical sign of trade defense evasion.

Previously, from April 2025, the Trade Defense Department sent a document to the General Department of Customs, regarding the increased inspection of HRC steel shipments with a width of 1,880mm or more. However, no timely tax policy measures have been issued.

"Trade defense based solely on such an administrative technical threshold without a quick update mechanism will be easily circumvented and ineffective," said an expert.

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Source: https://tuoitre.vn/lach-thue-voi-vai-milimet-thep-gia-re-tran-vao-viet-nam-20250723155948988.htm