General Department of Taxation's guidelines for sanctioning of administrative violations on taxes and invoices in Vietnam

General Department of Taxation's guidelines for sanctioning of administrative violations on taxes and invoices in Vietnam (Internet image) 

The General Department of Taxation of Vietnam issued Official Dispatch 4485/TCT-PC dated December 1, 2022 on the implementation of Decree 118/2022/ND-CP.

1. The General Department of Taxation's guidelines for sanctioning of administrative violations on taxes and invoices in Vietnam

Accordingl to Official Dispatch 4485/TCT-PC, the General Department of Taxation has notified the Department of Taxation to note the following contents:

- Identification of dependent units of the enterprise, business locations that directly declare and pay tax, use invoices for tax administrative violations, and are subject to sanctions according to the provisions of Point a, Clause 2, Article 3 of Decree 125/2020/ND-CP, and Clause 3, Article 3 of Decree 118/2021/ND-CP.

- Applying the minimum level of the fine bracket to cases with two or more extenuating circumstances and applying the maximum level of the fine bracket to cases with two or more aggravating circumstances, as prescribed at Point b, Clause 1, Article 9 of Decree 118/2021/ND-CP.

The aggravating and mitigating circumstances used to determine the fine bracket shall not be used when determining the specific fine amount.

- Explanations for administrative violations on taxes and invoices comply with the law on handling administrative violations and Article 37 of Decree 125/2020/ND-CP.

In case the taxpayer requests an explanation and falls into the case of explanation as prescribed in Article 61 of the Law on Handling of Administrative Violations (amended in 2020), the time limit for issuing the sanctioning decision shall comply with the provisions of Point b, Clause 1, Article 66 of the Law on Handling of Administrative Violations (amended in 2020).

In case the taxpayer makes an explanation for administrative violations according to the cases specified at Point a, Clause 1, Article 37 of Decree 125/2020/ND-CP but not in the cases explained according to the provisions of Article 61 of the Law on Handling of Administrative Violations (amended in 2020), then:

The time limit for issuing the sanctioning decision shall comply with the provisions of Point a, Clause 1, Article 66 of the Law on Handling of Administrative Violations (amended and supplemented in 2020).

- The time limit for issuing decisions on partial enforcement of decisions on sanctioning administrative violations in case individuals die, go missing, or organizations are dissolved or go bankrupt according to the provisions of Decree 118/2021/ND-CP

- Using templates of minutes and samples of decisions on sanctioning administrative violations issued together with Decree 118/2021/ND-CP. When using decision templates, please note the following:

+ Regarding tax codes: add tax identification information to the list of violating organizations/individuals.

+ Regarding remedial measures at Point 6.c, Article 1, Decision Form No. 02: Please refer to Point 6.c, Form No. 01/QD issued together with Decree 125/2020/ND-CP, to ensure that the content of remedial measures is fully displayed according to each tax type, economic content (sub-section), state budget revenue accounting area, tax authority managing the revenue, arrears tax amount...

- Using Form No. 01A/BB issued together with Decree 125/2020/ND-CP to make a record of tax administrative violations by electronic method.

2. What is an administrative violation on taxes and invoices?

According to Clauses 1 and 2, Article 2 of Decree 125/2020/ND-CP, the administrative violations on taxes and invoices in Vietnam are as follows:

- Tax administrative violation is an act committed by an organization or individual that violates the provisions of the law on tax administration, the law on taxes, and other revenues, which is not a crime and according to the law must be administratively sanctioned.

Other revenues include:

+ Land use fee;

+ Land rent, water surface rent;

+ Fees for granting mineral exploitation rights;

+ Money for granting the right to exploit water resources;

+ Profit after tax remaining after appropriating funds for enterprises in which 100% of charter capital is held by the State;

+ Dividends and profits are divided among the state capital invested in joint-stock companies and limited liability companies with two or more members.

- Administrative violation on invoices is an act of guilt committed by an organization or individual in violation of the law on invoices.
which is not a crime and, according to the law, must be administratively sanctioned.

More details can be found in Official Dispatch 4485/TCT-PC issued on December 1, 2022.

Quoc Dat

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