What are regulations on application of risk management to tax administration to taxpayers classified into levels of risks in each period in Vietnam?

Are risk management procedures employed in application of risk management to tax administration in Vietnam?

Based on Clause 1, Article 3 of Circular 31/2021/TT-BTC the provisions are as follows:

Definitions

1. "application of risk management to tax administration" involves utilizing operational procedures, principles, measures, techniques of risk management, and the results of evaluating tax law compliance and taxpayer risk levels to decide on the execution of operational measures in tax administration.

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Accordingly, based on the above regulation, when applying risk management procedures, tax operations and other related factors must be coordinated for management.

What are regulations on application of risk management to tax administration to taxpayers classified into levels of risks in each period in Vietnam? (Image from the Internet)

What are regulations on application of risk management to tax administration to taxpayers classified into levels of risks in each period in Vietnam?

Based on Article 13 of Circular 31/2021/TT-BTC, the application of risk management to tax administration to taxpayers classified into levels of risks in each period is as follows:

- The tax authorities, based on the results of evaluating tax law compliance as stated in Article 10 of Circular 31/2021/TT-BTC, the classification results of taxpayer risk levels as stated in Article 11 of Circular 31/2021/TT-BTC and Article 12 of Circular 31/2021/TT-BTC, and operational information at the time of decision making, will determine the list of taxpayers classified according to the levels of risk in each period and perform:

+ Managing tax law compliance;  
+ Risk management in taxpayer registration;
+ Risk management in inspecting tax records at the tax authority's office;
+ Risk management in tax refund administration;
+ Risk management in audits and inspections at the taxpayer's office;
+ Risk management in tax debt administration and enforcement of tax administrative decisions;
+ Risk management in invoicing and certification administration;
+ Risk management of taxpayers under special scrutiny or supervision;
+ Risk management of individual taxpayers;
+ Application of risk management in other tax administration operations.

- The list of risky taxpayers according to the cases specified in Clause 1 of Article 13 of Circular 31/2021/TT-BTC shall be updated in the risk management applications in tax administration. Tax authorities at all levels are responsible for aggregating, updating, and managing information regarding risky taxpayers to serve the entire tax sector's administration.

- The General Department of Taxation shall detail the periodic assessment and listing of risky taxpayers according to the cases specified in Clause 1 of Article 13 of Circular 31/2021/TT-BTC to identify key areas for tax administration, meeting tax administration requirements in each period.

- If there is any suspicion or discovery of tax law violations through audit, inspection, denunciation letters, information from state management agencies, investigative agencies, the head of the tax authority will decide to change the form, inspection level, or other tax management measures as per authority and be responsible for their decisions.

What are responsibilities of State agencies in risk management in Vietnam?

Based on Article 25 of Circular 31/2021/TT-BTC, the responsibilities for implementation by state agencies are as follows:

- Agencies and functional units under the Ministry of Finance and other relevant Ministries and sectors; organizations, and individuals involved in tax administration activities are responsible for providing information and coordinating in the application of risk management to tax administration according to current legal regulations and the provisions of Circular 31/2021/TT-BTC.

- The Director-General of the General Department of Taxation, based on the guidance in Circular 31/2021/TT-BTC, is responsible for issuing:

+ The criteria indices stipulated in Articles 10, 11, and 12 of [Circular 31/2021/TT-BTC](https://lawnet.vn/vb/Thong-tu-31-2021-TT-BTC-ap-dung-quan-ly-rui-ro-trong-quan-ly-thue-73E17.html#dieu_12) to meet tax administration requirements in each period; an annual review, amendment, and supplement of the criteria indices to ensure they are updated and relevant to reality;
+ Specific regulations on the responsibilities of tax authorities at all levels, tax officials, and measures for collecting and processing risk management information; technical and operational measures in tax risk management;
+ Processes, regulations, and guidelines for implementing and applying risk management procedures.

- The Risk Management Unit is the focal unit responsible for:

+ Managing and operating risk management applications in tax administration and information and data systems serving risk management as decentralized;
+ Organizing implementation and guiding operations, inspecting the collection and processing of risk management information; risk management measures and techniques and applying risk management procedures operations;
+ Managing the index criteria issued by the Director-General at point a, clause 2 of this Article on the risk management information system and other related information systems; monitoring, evaluating, adjusting, and supplementing the criteria indices to meet management requirements in each period.

- Tax Departments, Regional Tax Departments, Tax Authorities, Departments, Units under the General Department of Taxation, and tax officials are responsible for adequately and fully implementing the provisions regarding the implementation and application of risk management stated in Circular 31/2021/TT-BTC and other relevant legal documents.