Vietnam: Collection of judgments on complaints about administrative decisions in the tax field

Hello, Lawnet would like to answer as follows:

Tax is a mandatory levy to the state fund; this revenue from certain individuals, organizations or enterprises; paying tax is a mandatory obligation of the subject subject to tax; prescribed by law. Recently, the status of lawsuits and complaints in the field of tax and tax arrears in Vietnam is increasing and complicated.

1. Judgment 22/2017/HC-ST dated September 21, 2017 on lawsuit against decision on tax arrears

- Level of trial: First instance

- Judicial body: People's Court of Ben Tre province

- Quoting the content: "According to the law, value added tax is collected on goods. According to the records, Mr. C bought and sold Bitcoin via the Internet. To date, no authority has confirmed that Bitcoin is a virtual currency, a cryptocurrency or a digital currency. Thus, to confirm what Bitcoin is, the state must recognize it, which it has not yet done. Therefore, there is no basis to claim that Bitcoin is a commodity. Therefore, the fact that the tax authority thinks that Bitcoin is a commodity, that Bitcoin trading is a commodity business, so it is subject to value-added tax and personal income tax, is groundless. The defendant said that in the lawsuit, Mr. C stated that "the tax authority collects too much tax", which means that Mr. C accepts the payment of tax if the tax authority reduces the tax. Such an interpretation is not correct because this is just one of the grounds for Mr. C to request the cancellation of the administrative decision."

2. Judgment on lawsuits against administrative decisions in the field of tax and tax collection No. 07/2022/HC-PT

- Level of trial: Appellate

- Judicial body: People's Court of Ba Ria - Vung Tau province

- Quote from the content: "The couple received the transfer of the land plot at Lot S2 A Chau Residential Area, Ward 2, Vung Tau City of Company G with a total value of 13.5 billion VND of real estate and land. All taxes and fees related to the transfer shall be paid by Company G, which shall also carry out all procedures for registration of the name transfer and transfer of real estate ownership to the couple. The three-party agreement made on May 18, 2020, stating that the above house is worth 21 billion VND, is at the request of grandparents to borrow money from Vietcombank-Thu Thiem branch. They are only responsible for paying the Company an amount of VND 13.5 billion, not an amount of VND 21 billion as determined by the tax authorities."

3. Judgment 488/2018/HC-PT dated July 23, 2019 on complaints about administrative decisions in the tax field

- Level of trial: Appellate

- Judicial body: High People's Court in Ho Chi Minh City

- Quoting the content: "Considering that Decision No. 686 has partially accepted Mr. L's complaint, it has reduced Mr. L's payable tax amounts to VND 2,568,389,956. However, it did not state the remaining amount that Mr. L had to pay, did not specify specific fines, but the defendant said that the amount Mr. L had to pay under Decision No. 686 was 2,142,342,149 VND (4,710. 732,105 - 2,568,389,956 = 2,142,342,149 VND). This is the non-deductible VAT amount for invoices purchased by private enterprise Dang L of L Company Limited. The defendant claimed that the 06 invoices provided by Mr. L in the file, with a total purchase amount of 12,033,406,530 VND provided by L Company Limited to Mr. L, are illegal invoices. Therefore, the Director of Tax Department of Ca Mau Province does not accept the deduction of VAT for private enterprise Dang L, which is 10%, or 1,203,340,653 VND. In addition, forcing Mr. L to pay late payment interest, fines...; total is 2,142,342,149 VND."

4. Judgment 60/2018/HC-PT dated April 10, 2018 on lawsuits against administrative decisions in the tax field

- Level of trial: Appellate

- Judicial body: High People's Court in Da Nang

- Quoting the content: "In Clause 2, Article 31 of the Law on Corporate Income Tax 2003, it stipulates: "The income from the transfer of land use rights of a business establishment is subject to corporate income tax in accordance with this Law." and in Article 15 of Decree 164/2003/ND-CP of December 22, 2003, detailing guidelines for the implementation of the Law on Corporate Income Tax 2003, providing: "The preferential tax rates, tax exemptions, and reductions prescribed in Chapter V of this Decree shall not apply to incomes from the transfer of land use rights or land lease rights." Thus, with the provisions of the 2003 Law on Corporate Income Tax, the tax exemption or reduction does not apply to income from the transfer of land use rights. Decision No. 111/QD-XPHC dated October 3, 2008 of the Chairman of the People's Committee of Quang Ngai province applying remedial measures: The arrears of the tax payable to the State budget from the income tax on land use right transfer are 3,667,462,000 VND, which is legal."

5. Judgment 07/2019/HC-ST dated September 5, 2019 on complaints about decisions on sanctioning tax violations, decisions on settlement of complaints in the tax field

- Level of trial: First instance

- Judicial body: People's Court of Ninh Thuan province

- Quoting the content: "TL Co., Ltd. believes that the construction of the social housing projects D7-D10 by the project owner through the Housing and Apartment Management Center is subject to the 5% VAT rate of 5% under the provisions of point g, clause 2, Article 6 of Decree 209/2013/ND-CP dated December 18, 2013 of the Government and Circular 219/2013/TT-BTC of December 31, 2013 of the Ministry of Finance. With this view, the company confused the construction of social housing with selling directly to social housing buyers according to the provisions of the law on housing and the construction of social houses for sale to organizations and individuals for resale to social housing buyers in accordance with the housing law. The case of TL Co., Ltd. is to build social housing to sell to the Housing and Apartment Management Center and resell to social housing buyers in accordance with the housing law. In case TL Co., Ltd. accepts the social housing construction project from the Housing and Apartment Management Center, the construction activity is subject to the 10% VAT rate."

Best regards!

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