Is the taxpayer subject to tax imposition for failing to comply with the customs authority’s inspection decision in Vietnam?

Is the taxpayer subject to tax imposition for failing to comply with the customs authority’s inspection decision in Vietnam?

Pursuant to Clause 1, Article 52 of the Law on Tax Administration 2019, the regulations are as follows:

Tax imposition for exported and imported goods

1. The customs authority conducts tax impositions on exported and imported goods in the following cases:

a) The taxpayer utilizes non-compliant documents for tax declaration and calculation; fails to declare tax or declares inaccurately and incompletely concerning the determination of tax obligations;

b) The taxpayer does not provide, refuses, or delays the provision of records, accounting books, documents, evidence, data, and figures related to the accurate determination of payable tax within the regulated timeline;

c) The taxpayer fails to explain, justify, or does not justify within the regulated timeline the contents related to tax obligation determination according to the law; does not comply with customs authority’s inspection decision;

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Thus, a taxpayer who does not comply with the customs authority’s inspection decision is subject to tax imposition.

Is the taxpayer subject to tax imposition for failing to comply with the customs authority’s inspection decision in Vietnam? (Image from the Internet)

What are the 04 responsibilities of the tax authority in tax imposition in Vietnam?

Based on Article 53 of the Law on Tax Administration 2019, the 04 responsibilities of the tax authority in tax imposition are as follows:

- The tax administration authority must notify the taxpayer in writing of the reason for tax imposition, the basis for the tax imposition, the assessed tax amount, and the deadline for tax payment.

- In the case of tax imposition conducted through a tax inspection or tax audit, the reason for tax imposition, the basis for the tax imposition, the assessed tax amount, and the deadline for tax payment must be recorded in the tax inspection or audit report, and the tax handling decision of the tax administration authority.

- If the tax imposition amount determined by the tax administration authority is greater than the amount payable according to the resolution of the complaint by the competent authority or a court ruling, the tax administration authority must refund the overpaid tax amount.

- If the tax imposition amount determined by the tax administration authority is less than the amount payable according to the resolution of the complaint by the competent authority or a court ruling, the taxpayer is responsible for the supplementary payment.

The tax administration authority is responsible for the tax imposition.

What are the bases for tax imposition in Vietnam?

According to Article 15 of Decree 126/2020/ND-CP, the bases for tax imposition are regulated as follows:

(1). Taxpayers subject to imposition of separate elements related to the determination of payable tax amounts:

- Organizations and individuals subject to imposition of separate elements related to the determination of payable tax amounts when they fall into one of the following cases:

+ Through reviewing tax declaration dossiers, the tax authority has grounds to believe that the taxpayer's declaration lacks completeness or accuracy on the factors forming the basis for determining the payable tax amount and has requested the taxpayer to provide additional declarations, but the taxpayer does not supplement or inaccurately and dishonestly supplements as requested.

+ Through reviewing accounting books, invoices, and evidence related to the determination of payable tax amounts of the taxpayer or through cross-checking, verification, accounting books, invoices, and evidence of related organizations or individuals, the tax authority can prove that the taxpayer inaccurately or dishonestly records elements related to the determination of payable tax amounts.

+ Recording sale prices of goods, services not in accordance with actual payment prices, reducing taxable revenue, or recording purchase prices of goods and raw materials for production and business not in accordance with actual payment prices appropriate to the market, increasing deductible value-added tax, reducing payable tax obligations.

+ The taxpayer submits a tax declaration dossier but cannot determine the factors forming the basis for tax calculation or determines these factors but cannot self-calculate the payable tax amount.

+ Falling into one of the cases prescribed in Clauses 10, 11, and 12, Article 14 of Decree 126/2020/ND-CP.

- Bases for tax imposition:

+ For taxpayers who are organizations:

The database of the tax administration authority and commercial databases; effective documents and inspection, audit results; verification results; the average minimum payable tax amount of three business establishments with the same products, industry, scale in the locality; if the locality does not have or lacks information on products, industry, and the scale of business establishments, the information from business establishments in other localities will be used for element-wise imposition.

+ For individuals transferring, inheriting, receiving real estate gifts:

The tax authority determines the taxable price in cases where it is found that the individual declares and pays tax on taxable prices lower than the usual market transaction prices. The taxable price determined by the tax authority must match the market transaction price but not lower than the price set by the Provincial or City People's Committee at the time of price determination.

- Based on each element assessed, the tax authority determines the payable tax amount according to the current tax law.

(2). Taxpayers subjected to tax amount imposition according to the revenue ratio as regulated by law:

- Organizations paying value-added tax using the direct method, individual business taxpayers using the declaration method shall have the payable tax amount assessed based on the revenue ratio when falling into one of the cases specified in Clauses 1 through 11, Article 14 of Decree 126/2020/ND-CP.

- Bases for tax imposition:

The database of the tax administration authority and commercial databases; effective documents and inspection, audit results; verification results; the minimum revenue of three business establishments with the same products, industry, scale in the locality; if the locality lacks business establishment information on products, industry, and scale, the information from business establishments in other localities with similar natural and economic development conditions will be used to assess the taxable revenue.

- Based on the assessed revenue, the tax authority determines the payable tax amount according to the current tax law.