What is the content of proposal of 02 tax debt thresholds for exit suspension in Vietnam effective from January 1, 2025?

What is the content of proposal of 02 tax debt thresholds for exit suspension  in Vietnam effective from January 1, 2025?

The Ministry of Finance is seeking public comments on the draft Decree detailing Clause 9, Article 6 of the Law amending and supplementing some articles of the Law on Securities, the Law on Accounting, the Law on Independent Audit, the Law on State Budget, the Law on Management and Use of Public Assets, the Law on Tax Administration, the Law on Personal Income Tax, the Law on National Reserves, and the Law on Handling Administrative Violations.

According to Article 1 of the Draft Decree Download, it proposes to apply two thresholds of tax debt and debt maturity for cases subject to exit suspension as follows:

Application of debt threshold and debt duration for cases subject to exit suspension:

1. Individuals engaged in business, and business household heads with overdue tax debts for more than 120 days from 10 million VND or more.

2. Individuals who are legal representatives of taxpayers, which are enterprises, cooperatives, or cooperative unions subject to enforcement of administrative decisions on tax management with overdue tax debts for more than 120 days from 100 million VND or more.

3. Individuals engaged in business; business household heads; individuals who are legal representatives of enterprises, cooperatives, or cooperative unions who are no longer operating at their registered address and have not fulfilled their tax obligations.

Thus, from January 1, 2025, the two tax debt thresholds for applying exit suspension could be proposed as follows:

- Tax debt from 10 million VND or more and overdue for 120 days for individuals engaged in business, and business household heads.

- Tax debt from 100 million VND or more and overdue for 120 days for individuals who are legal representatives of taxpayers which are enterprises, cooperatives, or cooperative unions subject to enforcement of administrative decisions on tax management.

What is the content of proposal of 02 tax debt thresholds for exit suspension  in Vietnam effective from January 1, 2025? (Image from the Internet)

Who has the authority to decide on exit suspension for tax debt cases in Vietnam?

Based on Clause 2, Article 21 of Decree 126/2020/ND-CP, regulations on the authority to decide on exit suspension, extension, and cancellation of exit suspension are as follows:

Completing tax obligations in cases of exit

...

2. Authority to decide on exit suspension, extension, and cancellation of exit suspension

a) The Head of the tax administrative agency directly managing the taxpayer has the authority based on practical conditions and tax management work in the locality to decide on selecting cases for exit suspension as stipulated in Clause 1 of this Article.

b) The person authorized to decide on exit suspension is also authorized to decide on the extension and cancellation of exit suspension.

c) The person authorized to decide on exit suspension is responsible for canceling the exit suspension no later than 24 working hours after the taxpayer has fulfilled their tax obligations.

...

Therefore, the authority to decide on exit suspension for tax debt cases belongs to the head of the tax administrative agency that directly manages the taxpayer.

Additionally, after the taxpayer has fulfilled their tax obligations, the head of the tax administrative agency directly managing the taxpayer is responsible for canceling the exit suspension no later than 24 working hours.

What is the procedure for exit suspension for tax debt cases in Vietnam?

Based on Clause 3, Article 21 of Decree 126/2020/ND-CP, the procedures for implementing exit suspension are as follows:

(1) After reviewing and accurately determining the tax obligations of the taxpayer, the tax administrative agency directly managing the taxpayer prepares a list of individuals, and individuals who are legal representatives of enterprises subject to exit suspension and drafts a document according to Form 01/XC Appendix 3 Decree 126/2020/ND-CP sent to the immigration management agency and also to the taxpayer so they can fulfill their tax obligations before exit.

(2) On the same day when receiving the document of exit suspension from the tax agency, the immigration management agency is responsible for implementing the suspension in compliance with regulations and posting the information on its electronic portal.

(3) In cases where the taxpayer has fulfilled their tax obligations, within 24 working hours, the tax agency will issue a document canceling the exit suspension according to Form 02/XC Appendix 3 Decree 126/2020/ND-CP to be sent to the immigration management agency to execute the cancellation of the suspension according to regulations.

Before the exit suspension period ends 30 days and if the taxpayer has not completed their tax obligations, the tax agency will send a document for extending the exit suspension according to Form 02/XC Appendix 3 Decree 126/2020/ND-CP to the immigration management agency, and also inform the taxpayer.

(4) Documents on exit suspension, extension of exit suspension, and cancellation of exit suspension are sent via postal service or electronically if conditions permit for electronic transactions and are posted on the tax agency's electronic portal. In cases where documents sent via postal service to the taxpayer are returned and the document has already been posted on the tax agency's portal, it is considered as having been sent.