Arrears, refunds, fines of hundreds of billions of VND
According to Mr. Vu Manh Cuong, the Department of Inspectorate has submitted to the GDoT for issuance of official documents directing the strengthening of inspection and examination, focusing on businesses in industries and fields with large revenue but high risks such as e-commerce, digital business; businesses with high risks of tax refund, invoices; petroleum, electricity, banking, insurance, real estate; electronic components; and businesses entitled to tax exemption and tax remission.
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| "The Tax Sector works with the police agencies to verify arising economic transactions, detect invoice fraud, misappropriate tax refunds, and coordinate with banks to verify payment via bank..." Mr. Vu Manh Cuong - Director of the Department of Inspectorate (under the General Department of Taxation) |
Furthermore, the Tax Sector has applied the risk management mechanism principle of inspection and examination; strengthened the inspection and examination of value-added tax refunds for high-risk identification dossiers, particularly for some items such as tapioca starch, rubber, cashew nuts, wood chips, and agricultural products; and controlled inspection and examination activities of businesses in the area to ensure that they do not overlap with plans of superior tax authorities and other functional agencies as prescribed.
Tax Departments of provinces and municipal cities have organized a peak month to prevent businesses from illegally buying and selling invoices and fraudulently refunding taxes.
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| Actively coordinate and exchange information to prevent tax loss |
The GDoT held a section-wide online conference on April 21, 2023, to discuss solutions to foster the management and prevention of fraud in the use of electronic invoices (e-invoices).
Simultaneously, the GDoT has just issued a procedure for risk management, assessment, and identification of taxpayers exhibiting signs of risk in invoice management and use. At the same time, the Tax Sector has implemented a nationwide system of analyzing e-invoice databases since May 15, 2023, with the ability to automatically score and create a list of high-risk taxpayers to facilitate management.
By the end of June 2023, the Tax Sector had carried out 25,912 inspections and examinations, accounting for 32.34% of the 2023 plan, a 4.28% increase over the same period last year. The Tax Sector has inspected 276,366 tax declaration dossiers at the tax authorities, a 91.06% growth over the same period last year. The Tax Sector has proposed to handle more than 30,276 billion VND through inspection and examination, a 77.16% increase, of which: the total amount of tax increased through inspection and examination is 7,334 billion VND; the decrease of the deduction is 841 billion VND; and loss reduction is 22,099 billion VND. The total tax amount paid to the State budget is 4,888 billion VND, equivalent to 68.73% of the increase in revenue from inspection and examination.
Moreover, the Tax Sector has inspected 229 businesses with associated transactions, thereby collecting, refunding, and fining an aggregate amount of 657 billion VND, reducing losses by 7,442 billion VND, lowering deductions by 20 billion VND, and adjusting to increase taxable income by 1,970 billion VND. In particular, inspections redetermining the market price for associated transactions have collected 320 billion VND arrears, reduced losses by 6,814 billion VND, and adjusted to increase taxable income by 1,555 billion VND.
Mr. Vu Manh Cuong claimed that the tax inspection in the first months of the year has been carried out flexibly, and appropriately under regulations based on the results.
Strengthen information exchange to prevent tax loss
According to representatives of the Department of Inspectorate, the Tax Sector will strengthen inspection and examination of fields with high risks of fraud and tax evasion, industries and fields with large revenue such as e-commerce, and digital business, as well as fight against tax refund fraud, false invoices, and transfer pricing.
Simultaneously, the Tax Sector continues to improve revenue management for e-commerce businesses on electronic trading floors, businesses trading gold, silver, precious stones, and so on.
In addition, the Tax Sector will enhance coordination and information exchange with relevant ministries and agencies to promptly capture information and detect violations; conduct inspections and examinations to identify violations for timely rectification to improve taxpayers' tax law compliance.
The Tax Sector, in particular, needs to increase the awareness of taxpayers about the identification of illegal purchases and use of invoices. To be more specific, each tax official should act as a channel to propagate to taxpayers about the identification of illegal purchases and use of invoices, as well as sanctions for each violation.
The General Director of the GDoT has just issued Decision No. 970/QD-TCT promulgating the procedure of tax inspection. According to Mr. Vu Manh Cuong, the procedure is issued to strengthen tax inspection under the law on tax management through the application of risk management mechanisms and the use of information technology in tax inspection to detect, prevent, and promptly handle tax violations and prevent tax loss.
Simultaneously, this procedure aims to improve taxpayers' self-discipline in complying with tax laws; implement administrative reform in tax inspection; and support taxpayers to develop the production and trading of goods and services.
