What are taxes, fees, and charges in Vietnam? What are principles for determining the fee and charge rates?

What are taxes, fees, and charges in Vietnam?

According to the provisions of Article 3 of the 2019 Law on Tax Administration explaining the concept of tax as follows:

Explanation of Terms

In this Law, the following terms are understood as follows:

1. Tax is a compulsory contribution to the state budget by organizations, households, business households, and individuals as stipulated in tax laws.

Tax is a compulsory contribution to the state budget by organizations, households, business households, and individuals as stipulated in tax laws.

Article 3 of the 2015 Law on Fees and Charges stipulates the concept of fees and charges specifically as follows:

Explanation of Terms

In this Law, the following terms are understood as follows:

1. Fee is an amount that organizations and individuals must pay to basically compensate for costs and for services provided by state agencies, public service providers, and organizations authorized by state agencies as set out in the Fee Schedule issued with this Law.

2. Charge is a fixed amount that organizations and individuals must pay when provided with public services by state agencies for the purpose of covering state management work as set out in the Charge Schedule issued with this Law.

Thus, based on the definitions, taxes, fees, and charges are mandatory contributions that organizations and individuals must submit to the state budget.

However, tax is a compulsory contribution to the state budget by organizations, households, business households, and individuals. Meanwhile, fees and charges are other types of collections to compensate costs when the State, public service providers, or other organizations provide public services or perform state management work.

What are taxes, fees, and charges in Vietnam? What are principles for determining the fee and charge rates? (Image from the Internet)

What are principles of tax administration in Vietnam according to the 2019 Law on Tax Administration?

Based on Article 5 of the 2019 Law on Tax Administration, the following principles are stipulated:

Principles of Tax Administration

1. All organizations, households, business households, and individuals are obligated to pay taxes as stipulated by the law.

2. Tax administration agencies and other state agencies assigned with the duty of collection management shall perform tax administration according to this Law and other relevant laws, ensuring publicity, transparency, equality, and the legal rights and benefits of taxpayers.

3. Agencies, organizations, and individuals have the responsibility to participate in tax administration according to the provisions of the law.

4. Implement administrative procedure reform and application of modern information technology in tax administration; apply international tax administration principles, including the principle of the substance of transactions determining tax obligations, the risk management principle in tax administration, and other principles suitable to Vietnam's conditions.

5. Apply preferential measures when implementing tax procedures for exported and imported goods according to customs law and the regulations of the Government of Vietnam.

Tax administration is carried out according to the following 05 principles:

- All organizations, households, business households, and individuals are obligated to pay taxes as stipulated by the law.

- Tax administration agencies and other state agencies assigned with the duty of collection management shall perform tax administration according to this Law and other relevant laws, ensuring publicity, transparency, equality, and the legal rights and benefits of taxpayers.

- Agencies, organizations, and individuals have the responsibility to participate in tax administration according to the provisions of the law.

- Implement administrative procedure reform and application of modern information technology in tax administration; apply international tax administration principles, including the principle of the substance of transactions determining tax obligations, the risk management principle in tax administration, and other principles suitable to Vietnam's conditions.

- Apply preferential measures when implementing tax procedures for exported and imported goods according to customs law and the regulations of the Government of Vietnam.

What are principles for determining the fee and charge rates in Vietnam?

Based on the provisions of Article 8 of the 2015 Law on Fees and Charges and Article 9 of the 2015 Law on Fees and Charges, the principles for determining fee and charge rates are as follows:

For fee rates, the determination is based on the following principle:

- Fee rates are set to basically ensure compensation of costs, taking into account the state's socio-economic development policies at each period, ensuring fairness, publicity, transparency, and equality in the rights and obligations of citizens.

For charge rates, the determination is based on the following principle:

- Charge rates are predetermined, not aimed at compensating costs; registration fee rates are calculated as a percentage of asset value; ensuring fairness, publicity, transparency, and equality in the rights and obligations of citizens.