The Revenue Department is tightening its scrutiny of tax returns from the steel and building material sectors following allegations of duty refund fraud by SET-listed Samchai Steel Industries Plc.
The two sectors are department targets because it detected many false claims of value-added tax (VAT) refunds from them, said director-general Prasong Poontaneat.
Local steel manufacturers are in dire need of money because of the steep fall in steel prices and cut-throat competition, motivating them to evade tax payments and lower their operating costs, he said.
The department is keeping an eye on all steel manufacturers, said Mr Prasong, wary of sales involving fake VAT receipts and customs duty refund fraud.
The department always coordinates with the Customs Department and other state agencies, which led them to spot steel manufacturers committing fraud in Samut Sakhon and Nakhon Pathom provinces, he said.
It recently filed a complaint with the police to arrest a steelmaker in Khon Kaen province who sold millions of baht in falsified VAT receipts to other operators at a 35% discount of their face value, said Mr Prasong.
For the Samchai Steel case, he instructed revenue officials to launch backdated tax probes as to whether the company accurately paid taxes, in particular VAT.
The Customs Department alleged Samchai Steel had been running a duty refund scam after it found the company claimed fraudulent tax refunds, claiming import of goods to be used as parts for its products for re-export even though it did no such activity.
Mr Prasong said an investigation into tax payments by steel and construction and building material manufacturers was one way to increase the department's tax collection efficiency.
The tax collection system is expected to become more efficient after the Finance Ministry's single financial account scheme and national e-payment scheme are fully implemented, he said. It could take two to three years to see full contribution of tax payments through these systems, said Mr Prasong.
In the meantime, he said the Revenue Department's tax revenue for the seven months to April was off its target by 38 billion baht or 4.4%.
The department estimated its tax collection will miss the target by 100 billion baht for this fiscal year ending on Sept 30.
Its revenue target was about 1.9 trillion baht.