Cases of Tax Enforcement in Vietnam

Cases of Tax Enforcement in Vietnam

According to Article 124 of the Law on Tax Administration 2019, the cases subject to enforcement of administrative decisions on tax management (tax enforcement) include:

- Taxpayers with tax debts overdue by more than 90 days from the deadline according to regulations.

- Taxpayers with tax debts at the end of the tax deferral period.

- Taxpayers with tax debts who are dispersing assets or absconding.

- Taxpayers who do not comply with administrative penalty decisions for tax management violations within the specified time, except in cases of deferral or suspension of the enforcement of the penalty decision.

- Tax enforcement measures have not been implemented for cases where the taxpayer is permitted by the tax authority to defer tax debts within the deferral period; no late tax payment interest is calculated according to the Law on Tax Administration 2019; allowed to pay the tax debt gradually within a period not exceeding 12 months from the start of the enforcement period.

The gradual payment of tax debts is considered by the head of the tax authority directly managing the taxpayer, based on the taxpayer's request and must have a guarantee from a credit institution. The Minister of Finance stipulates the number of instalments and the dossier, and procedures for gradual tax debt payment.

- No enforcement measures are implemented for taxpayers with overdue customs fees and transit fees for goods and vehicles.

- Individuals who are the legal representatives of taxpayers must fulfil the tax obligations of enterprises subject to enforcement of administrative decisions on tax management before exit and may be temporarily suspended from exiting according to regulations of exit and entry laws.

Cases of Tax Enforcement in Vietnam (Image from the Internet)

What are tax enforcement measures in Vietnam?

Pursuant to clause 1 of Article 125 of the Law on Tax Administration 2019, the following tax enforcement measures are available:

- Deduction of money from the account of the party subject to enforcement of an administrative decision on tax management at the State Treasury, commercial banks, or other credit institutions; account blocking;

- Partial deduction of wages or income;

- Suspension of customs procedures for export and import goods;

- Suspension of invoice usage;

- Seizure and auction of distrained assets as prescribed by law;

- Collection of money and other assets of the party subject to enforcement of administrative decisions on tax management held by other agencies, organizations, or individuals;

- Revocation of the enterprise registration certificate, business registration certificate, cooperative registration certificate, investment registration certificate, establishment and operation license, practicing certificate.

Who has the authority to decide on tax enforcement in Vietnam?

According to Article 126 of the Law on Tax Administration 2019, the authority to decide on the enforcement of administrative decisions on tax management is as follows:

Authority to decide on the enforcement of administrative decisions on tax management

1. The head of the tax authority, the Director of the Anti-Smuggling Investigation Department of the General Department of Customs, and the Director of the Post-Customs Clearance Inspection Department have the authority to decide on the application of enforcement measures for administrative decisions on tax management as stipulated in clauses a, b, c, d, dd, and e of paragraph 1 of Article 125 of this Law.

2. The revocation of the enterprise registration certificate, business registration certificate, cooperative registration certificate, investment registration certificate, establishment and operation license, and practicing certificate stipulated in clause g of paragraph 1 of Article 125 of this Law is carried out according to the provisions of the law.

Thus, the authority to decide on the application of tax enforcement measures is as follows:

- The head of the tax authority, the Director of the Anti-Smuggling Investigation Department of the General Department of Customs, and the Director of the Post-Customs Clearance Inspection Department have the authority to decide on the application of the following tax enforcement measures:

+ Deduction of money from the account of the party subject to enforcement of an administrative decision on tax management at the State Treasury, commercial banks, or other credit institutions; account blocking;

+ Partial deduction of wages or income;

+ Suspension of customs procedures for export and import goods;

+ Suspension of invoice usage;

+ Seizure and auction of distrained assets as prescribed by law;

+ Collection of money and other assets of the party subject to enforcement of administrative decisions on tax management held by other agencies, organizations, or individuals;

- For the measure of revoking the enterprise registration certificate, business registration certificate, cooperative registration certificate, investment registration certificate, establishment and operation license, and practicing certificate, the decision of revocation will be made according to legal provisions.