When is the enforcement by seizure of the taxpayer’s assets and sell them at auction not applied in Vietnam?

When is the enforcement by seizure of the taxpayer’s assets and sell them at auction not applied in Vietnam?

According to Article 133 of the Law on Tax Administration 2019, regulations on Enforcement by seizure of the taxpayer’s assets and sell them at auction are as follows:

Enforcement by seizure of the taxpayer’s assets and sell them at auction

1. The measure of asset seizure is not applied in the case where the taxpayer is an individual undergoing medical treatment at a medical facility established according to the provisions of law.

2. The value of the assets seized from the enforced subject is equivalent to the amount of tax stated in the enforcement decision and the costs for organizing the enforcement execution.

3. The following assets are not to be seized:

a) Medicines, food, and necessities for the essential needs of the person being enforced to execute the administrative decision on tax management and their family;

b) Labor tools;

c) Sole residence, essential living items for the individual enforced to execute the administrative decision on tax management and their family;

d) Worship items; antiquities, medals, ordinals, certificates of merit;

dd) Assets serving national defense and security.

4. Within 30 days from the date of asset seizure, if the individual enforced to execute the administrative decision on tax management does not pay the full owed tax, the tax administration authority is entitled to auction the seized asset to collect the full owed tax.

5. The Government of Vietnam will provide detailed regulations on this Article.

Therefore, the measure of asset seizure is not applied in the case where the taxpayer is an individual undergoing medical treatment at a medical facility established by law.

In addition, the value of the seized asset from the enforced subject must be equivalent to the amount of tax stated in the enforcement decision and the costs for organizing the enforcement execution.

When is the enforcement by seizure of the taxpayer’s assets and sell them at auction not applied in Vietnam?

Which assets are not seized when applying enforcement by seizure of the taxpayer’s assets and sell them at auction in Vietnam?

Based on Clause 2, Article 35 of Decree 126/2020/ND-CP, the assets not to be seized when applying enforcement by seizure of the taxpayer’s assets and sell them at auction are as follows:

(1) For individuals enforced to execute administrative decisions on tax management:

- The sole residence of the individual and the family of the person being enforced.

- Medicines, food, and necessities for the essential needs of the individual and the family of the person being enforced.

- Ordinary labor tools necessary for the main or sole livelihood of the individual and the family of the person being enforced.

- Clothing, essential living items of the individual and the family of the person being enforced.

- Worship items; antiquities, medals, ordinals, certificates of merit.

(2) For production and business establishments:

- Medicines, vehicles, tools, assets belonging to medical facilities, except when these are circulating assets for business; food, tools, assets serving mid-shift meals for workers.

- Nursery schools, schools, and their equipment, vehicles, and belongings, if these are not circulating assets for business of the enterprise.

- Equipment, tools ensuring labor safety, fire prevention and fighting, environmental pollution prevention.

- Infrastructure serving public interests, national security, defense; imported goods directly serving national security, defense; exported and imported goods serving social welfare assurance, disaster recovery, epidemic; goods imported for humanitarian aid, non-refundable aid.

- Raw materials, finished products, semi-finished products that are hazardous toxic chemicals prohibited from circulation.

- Raw materials, semi-finished products that are in a closed production line.

(3) For state agencies, political organizations, socio-political organizations, socio-professional organizations (collectively referred to as agencies, organizations) operating with funds provided by the state budget, not to seize the assets purchased from the state budget, but request the agency, organization to submit a written request to the competent authority for financial support to execute the enforcement decision.

In the case where the agency, organization has income from other lawful activities, seize assets invested, purchased from that income source to execute the enforcement decision, except for the following assets:

- Medicines, vehicles, tools, assets belonging to medical facilities, except when these are circulating assets for business; food, tools, assets serving mid-shift meals for officials.

- Nursery schools, schools, their equipment, vehicles, and belongings, if these are not circulating assets for business of the agency, organization.

- Equipment, vehicles, tools ensuring labor safety, fire prevention and fighting, environmental pollution prevention.

- Office headquarters.

- Infrastructure serving public interests, national defense, security.

Which entity is subject to enforcement by seizure of the taxpayer’s assets and sell them at auction in Vietnam?

According to Clause 1, Article 35 of Decree 126/2020/ND-CP, the subjects subjected to enforcement by seizure of the taxpayer’s assets and sell them at auction are as follows:

- enforcement by seizure of the taxpayer’s assets and sell them at auction applies to taxpayers who are enforced to execute administrative decisions on tax management but are not applicable to the enforcement measures stipulated in points a, b, c, d Clause 1 Article 125 of the Law on Tax Administration 2019 or those measures have been applied but the owed tax has not been fully collected into the state budget or fall into the situation stipulated in Clause 3 Article 125 of the Law on Tax Administration 2019.

Administrative decisions on tax management include: Decision on administrative penalties for tax management violations; tax imposition notices, tax determination decisions; tax debt notices; refund recovery decisions; extension decisions; installment payment decisions; decisions terminating the effect of the tax debt recalculation decisions; decisions on applying remedial measures according to the provisions of law on handling administrative violations on tax management; decisions on compensation for damages; other administrative decisions on tax management according to the provisions of law.

- Asset seizure is not applied in cases where the taxpayer is an individual undergoing medical treatment at medical facilities established according to the provisions of law.