Does the Director of the Tax Department have the authority to impose taxes? What are cases of tax liability imposition in Vietnam?

Does the Director of the Tax Department have the authority to impose taxes in Vietnam?

Based on Article 16 of Decree 126/2020/ND-CP regulating the authority to impose taxes as follows:

Authority, procedures, and tax liability imposition decisions

1. tax liability imposition authority

The General Director of the General Department of Taxation; the Director of the Tax Department; the Head of the Tax Sub-department have the authority to impose taxes.

2. tax liability imposition procedures

a) When imposing taxes, the tax authority must notify the taxpayer in writing about the tax liability imposition and issue a tax liability imposition decision. The decision must clearly state the reasons for the imposition, the basis for the imposition, the imposed tax amount, and the deadline for tax payment.

b) In case the tax authority carries out tax liability imposition through tax inspection or tax audit, the reasons, basis, imposed tax amount, and payment deadline should be documented in the tax inspection minutes, tax audit, and tax handling decision of the tax authority.

c) In the event a taxpayer is subject to tax liability imposition as prescribed, the tax authority shall impose administrative penalties and calculate late payment interest as per legal regulations.

3. tax liability imposition decision

a) When imposing taxes, the tax authority must issue a tax liability imposition decision according to Form No. 01/ADT in Appendix III issued with this Decree, and simultaneously send it to the taxpayer within 3 working days from the date of signing the tax liability imposition decision;

For taxpayers who have to pay tax as per the tax authority's notice, the tax authority is not required to issue a tax liability imposition decision according to this provision.

b) Taxpayers must pay the imposed tax amount as per the tax handling decision of the tax authority. If a taxpayer disagrees with the tax amount imposed by the tax authority, the taxpayer must still pay the tax and is entitled to request the tax authority for an explanation or to file a complaint or lawsuit regarding the tax liability imposition.

Based on the above provisions, it can be seen that the Director of the Tax Department has the authority to impose taxes.

What is the deadline for paying imposed taxes? What are cases of tax liability imposition in Vietnam? (Image from the Internet)

What are cases of tax liability imposition in Vietnam?

According to Article 14 of Decree 126/2020/ND-CP taxpayers are subject to tax liability imposition in the following cases:

- Failing to register as a taxpayer as prescribed in Article 33 of the Law on Tax Administration 2019.

- Failing to file taxes or incompletely, truthfully, and accurately file taxes as prescribed in Article 42 of the Law on Tax Administration 2019.

- Failing to submit additional tax documents as required by the tax authority or submitting additional documents that do not fully, truthfully, and accurately reflect the tax calculation bases to determine payable tax amounts.

- Failing to reflect or incompletely, truthfully, and accurately reflect data in accounting books to determine tax obligations.

- Failing to present accounting books, invoices, documents, and necessary materials related to determining the factors for tax calculation; determining payable tax amounts within the prescribed time limit or when the tax inspection or audit period has ended at the taxpayer’s premises.

- Failing to comply with tax inspection decisions within 10 working days from the date of signing the decision, unless inspection time is deferred as prescribed.

- Failing to comply with tax audit decisions within 15 days from the date of signing the decision, unless audit time is deferred as prescribed.

- Buying, selling, exchanging, and accounting for the value of goods and services not in accordance with typical market transaction values.

- Buying, exchanging goods, services using illegal invoices, or using invoices illegally where goods, services are real according to findings of functional investigation, inspection, and audit bodies and have been declared for revenue, deductible expenses calculation for tax.

- Showing signs of absconding or dispersing assets to evade tax obligations.

- Conducting transactions that do not match the economic substance or practical occurrence in order to reduce taxpayer's tax obligations.

- Failing to comply with the obligations of declaring, determining related party transaction values, or not providing information according to tax management regulations for enterprises with related party transactions.

What are procedures for tax liability imposition in Vietnam?

According to Clause 2, Article 16 of Decree 126/2020/ND-CP, tax liability imposition procedures are executed as follows:

- When imposing taxes, the tax authority must issue a tax liability imposition decision according to Form No. 01/ADT Download in Appendix III issued with Decree 126/2020/ND-CP, and send it to the taxpayer within 3 working days from the date of signing the decision;

For taxpayers who have to pay tax as per the tax authority's notice, the tax authority is not required to issue a tax liability imposition decision.

- Taxpayers must pay the imposed tax amount as per the tax handling decision of the tax management authority. If a taxpayer disagrees with the tax amount imposed by the tax authority, the taxpayer must still pay the imposed tax and is entitled to request the tax authority for an explanation or to file a complaint or lawsuit regarding the tax liability imposition.