What is the maximum penalty for the crime of tax evasion in Vietnam?

Which acts are considered as tax evasion in Vietnam?

According to Article 143 of the Law on Tax Administration 2019, tax evasion acts include the following behaviors:

- Failure to file taxpayer registration documents; failure to submit tax declaration dossiers; submission of tax declaration dossiers after 90 days from the expiration of the deadline for filing tax declarations or the extended deadline for filing tax declarations as prescribed by the Law on Tax Administration 2019.

- Failure to record in the accounting books the revenues related to determining the amount of tax payable.

- Failure to issue invoices when selling goods or services as prescribed by law, or recording a value on the sales invoices lower than the actual payment value of the sold goods or services.

- Using illegal invoices, documents or illegitimately using invoices to account for goods, raw materials, and inputs in tax liability generating activities, thereby reducing the amount of tax payable or increasing the amount of tax exempted, tax reduced, tax credited, tax refunded, or tax not payable.

- Using documents, materials that do not accurately reflect the true nature of transactions or actual transaction values to wrongly determine the amount of tax payable, tax exempted, tax reduced, tax refunded, or tax not payable.

- Incorrectly declaring facts about exported or imported goods without supplementing the tax declaration dossier after the goods have been cleared.

- Deliberately not declaring or incorrectly declaring about taxes on exported or imported goods.

- Colluding with shippers to import goods for the purpose of tax evasion.

- Misusing non-taxable, tax-exempt, tax-concessional goods for unintended purposes without declaring the change in usage purpose to tax authorities.

- A taxpayer conducting business activities during the suspension or temporary suspension of business activities without notifying the tax authority.

- A taxpayer who is not penalized for acts of tax evasion but is penalized according to Clause 1, Article 141 of the Law on Tax Administration 2019 in the following cases:

+ Failure to file taxpayer registration documents, failure to submit tax declaration dossiers, submitting tax declarations after 90 days but no tax liability arises;

+ Submitting tax declarations after 90 days when tax arises and the taxpayer has paid the full amount of tax and late payment charges to the state budget before the tax authority announces a tax inspection or audit decision or before the tax authority records the act of late submission of the tax declaration dossier.

What is the maximum penalty for the crime of tax evasion in Vietnam?​ (Image from the Internet)

What is the maximum penalty for the crime of tax evasion in Vietnam?

According to Article 200 of the Criminal Code 2015 (amended by Point a, Clause 47, Article 1 of the Law Amending the Criminal Code 2017), the penalties for tax evasion are as follows:

Tax Evasion

1. Any person who commits one of the following acts of tax evasion involving an amount of from 100,000,000 VND to less than 300,000,000 VND or less than 100,000,000 VND but has been administratively penalized for a tax evasion act or has been convicted of this crime or any of the crimes defined in Articles 188, 189, 190, 191, 192, 193, 194, 195, 196, 202, 250, 251, 253, 254, 304, 305, 306, 309, and 311 of this Code, without having their criminal records expunged, shall be subject to a fine of from 100,000,000 VND to 500,000,000 VND or a prison sentence of from 03 months to 01 year:

a) Failure to file taxpayer registration documents; failure to submit tax declaration dossiers; submission of tax declarations after 90 days from the expiration of the deadline for filing tax declarations or the extended deadline for filing tax declarations as prescribed by law;

b) Failure to record in the accounting books the revenues related to determining the amount of tax payable;

c) Failure to issue invoices when selling goods or services or recording a value on the sales invoices lower than the actual payment value of the sold goods or services;

d) Using illegal invoices, documents to account for goods, raw materials, and inputs in tax liability generating activities, thereby reducing the amount of tax payable or increasing the amount of tax exempted, tax reduced, or tax credited;

dd) Using other illegal documents, materials to wrongly determine the amount of tax payable or credited;

e) Incorrectly declaring facts about exported or imported goods without supplementing the tax declaration dossier after the goods have been cleared if not belonging to the cases stipulated in Articles 188 and 189 of this Code;

g) Deliberately not declaring or incorrectly declaring about taxes on exported or imported goods if not belonging to the cases stipulated in Articles 188 and 189 of this Code;

h) Colluding with shippers to import goods if not belonging to the cases stipulated in Articles 188 and 189 of this Code;

i) Misusing non-taxable, tax-exempt goods for unintended purposes without declaring the change in usage purpose to tax authorities.

2. Committing the crime in any of the following cases, the offender shall be subject to a fine of from 500,000,000 VND to 1,500,000,000 VND or a prison sentence of from 01 year to 03 years:

a) Organized crime;

b) The amount of tax evaded is from 300,000,000 VND to less than 1,000,000,000 VND;

c) Taking advantage of positions and powers;

d) Committing the crime two or more times;

dd) Dangerous recidivism.

3. Committing the crime with an amount of tax evaded from 1,000,000,000 VND or more, the offender shall be subject to a fine of from 1,500,000,000 VND to 4,500,000,000 VND or a prison sentence of from 02 years to 07 years.

4. The offender may also be subject to an additional fine of from 20,000,000 VND to 100,000,000 VND, be banned from holding any position, practicing any occupation, or performing any work for 01 to 05 years or have part or all of their assets confiscated.

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As stipulated, a person committing any act of tax evasion involving the following amounts will be criminally prosecuted for tax evasion:

- The amount of tax evaded ranges from 100,000,000 VND to less than 300,000,000 VND.

- The amount of tax evaded is less than 100,000,000 VND, but the offender has been administratively penalized for tax evasion or convicted of this crime or any of the crimes defined in Articles 188, 189, 190, 191, 192, 193, 194, 195, 196, 202, 250, 251, 253, 254, 304, 305, 306, 309, and 311 of this Code, without having their criminal records expunged and commits the crime again.

The highest penalty for tax evasion is a fine up to 4,500,000,000 VND or a prison sentence up to 07 years.

Does the tax authority in Vietnam publicly disclose information on taxpayers committing tax evasion?

According to Clause 1, Article 29 of Decree 126/2020/ND-CP, the public disclosure of information on taxpayersis stipulated as follows:

Public Disclosure of Taxpayer Information

1. The tax authority publicly discloses information on taxpayers in the following cases:

a) Tax evasion, aiding tax evasion, misappropriation of tax money, violating tax laws and fleeing the business premises; unlawful issuance, use of invoices.

b) Failure to submit tax declaration dossiers after 90 days from the expiration of the deadline for filing tax declarations as prescribed by current tax laws.

c) Ceasing operations without completing the procedures for termination of tax identification numbers, not operating at the registered address.

d) Violations of tax laws by taxpayers affecting the tax rights and obligations of other organizations or individuals.

dd) Failure to comply with the tax authority's requests as prescribed by law, such as: Refusing to provide information or documents to the tax authority, failing to comply with inspection, audit decisions, or other requests from the tax authority as prescribed by law.

e) Obstructing, preventing tax officials, customs officials from performing their public duties.

g) Over 90 days from the expiration of the tax payment deadline or other financial obligations to the state budget or the deadline for compliance with tax administration decisions and the taxpayer or guarantor does not voluntarily comply.

h) Individuals or organizations not complying with tax administration decisions and have acts of spreading assets, fleeing.

i) Other information publicly disclosed as prescribed by law.

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The tax authority in Vietnam is authorized to publicly disclose information on taxpayers committing tax evasion.