Vietnam: What is a red invoices? What are the regulations on buying and selling red invoices? What are the penalties for buying and selling red invoices?
What is a red invoice in Vietnam?
Normally, people still call the red invoice to indicate the value-added invoice (VAT invoice), which is a type of document issued by the Ministry of Finance or self-printed by the enterprise if the form has been registered with the tax office.
Vietnam: What is a red bill? What are the regulations on buying and selling red invoices? What are the penalties for buying and selling red invoices?
What are the regulations on issuance of red invoices in Vietnam?
Red invoices usually show information on the value of goods sold and services provided to the buyer, information on the seller and buyer issued by the service provider, and also serve as a basis for determining the amount of tax to be paid into the state budget of the enterprise. Some of the following activities and services give rise to a specific red invoice as follows:
- Buy and sell goods, services, domestic products
- Export of goods and services
- Domestic and international transportation...
In more special cases, red invoices are the basis for enterprises to declare and deduct input and output value-added tax as well as account for production and business costs for enterprises.
For that reason, many businesses have now implemented the act of buying and selling red invoices to offset and balance between input and output value-added tax to limit the amount of value-added tax must be submitted to the state agency.
Currently, the situation of buying and selling red invoices is quite common, but not everyone realizes the risks from buying and selling red invoices. And according to current law, buying and selling red invoices is defined as a violation of the law.
Pursuant to the provisions of Clause 1, Article 203 of the 2015 Criminal Code, specifically:
Any person who prints, issues, deals in illegal blank invoices and receipts for payment of state revenues with a quantity of 50 - 100 or illegal filled invoices and receipts with a quantity of 10 - 30 or the illegal profit earned is from VND 30,000,000 to under VND 100,000,000 shall be liable to a fine of from VND 50,000,000 to VND 200,000,000, face a penalty of up to 03 years' community sentence or 06 - 36 months' imprisonment.
Accordingly, the person who performs the act of buying and selling red invoices may be prosecuted for criminal responsibility for the crime of illegally trading in invoices.
At the same time, in Article 2 of Joint Circular 10/2013/TTLT-BTP-BCA-TANDTC-VKSNDTC-BTC, Illegally trading invoices, receipts of state budget remittances includes the following acts:
- Trading the invoices without content or with insufficient or incorrect content as prescribed;
- Trading the invoices which are filled content, but there is no goods or service enclosed;
- Trading counterfeit invoices, invoices not yet had use value, invoices expired use value, invoices of other business and service establishments to legalize the bought goods and services or to issue for clients upon selling goods, services;
- Trading, using invoices with difference of value of goods, services between invoice originals.
According to Clause 1, Article 203 of the 2015 Criminal Code, the act of illegally buying and selling invoices only constitutes a crime if it falls into one of the following cases:
- illegal blank invoices and receipts for payment of state revenues with a quantity of 50 - 100;
- illegal filled invoices and receipts with a quantity of 10 - 30;
- illegal profit earned is from VND 30,000,000 to under VND 100,000,000.
What are the penalties for buying and selling red invoices in Vietnam?
In Article 203 of the 2015 Criminal Code (Clause 2, Point b, Clause 4 of this Article, as amended by Point k, Clause 2, Article 2 of the Law on Amendment of the Criminal Code 2017) stipulates the fine level of the crime of illegally trading in red invoices. As follows:
For individuals:
This offence committed in any of the following circumstances carries a fine of from VND 100,000,000 to VND 500,000,000 or a penalty of 01 - 05 years' imprisonment:
- The offence is committed by an organized group;
- The offence is committed in a professional manner;
- The offence involves the abuse of the offender's position or power;
- The quantity of blank invoices and receipts is ≥ 100; the quantity of filled invoices an receipts is ≥ 30;
- The illegal profit earned is ≥ VND 100,000,000;
- The loss incurred by state budget is ≥ VND 100,000,000;
- Dangerous recidivism.
The offender might also be liable to a fine of from VND 10,000,000 to VND 50,000,000, be prohibited from holding certain positions or doing certain works for 01 - 05 years.
For corporate legal entity:
Punishments incurred by a corporate legal entity that commits any of the offences specified in this Article:
- A corporate legal entity that commits this offence in any of the circumstances specified in Clause 1 of this Article shall be liable to a fine of from VND 100,000,000 to VND 500,000,000;
- A corporate legal entity that commits this offence in any of the circumstances specified in Clause 2 of this Article shall be liable to fine of from VND 500,000,000 to VND 1,000,000,000;
- A corporate legal entity that commits this offence in any of the circumstances specified in Article 79 hereof shall be permanently shut down;
- The violating corporate legal entity might also be liable to a fine of from VND 50,000,000 to VND 200,000,000, be banned from operating in certain fields or raising capital for 01 - 03 years.
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