The General Department of Taxation to request speeding up the processing of tax refund applications in Vietnam

The General Department of Taxation to request speeding up the processing of tax refund applications in Vietnam (Internet image)

Regarding this issue, LawNet would like to answer as follows:

On August 9, 2023, the General Department of Taxation issued Official Telegram 07/CD-TCT on accelerating the settlement of value-added tax (VAT) refund dossiers.

The General Department of Taxation to request speeding up the processing of tax refund applications in Vietnam

Specifically, according to Official Telegram 07/CD-TCT, in order to resolve the delay and lateness in checking and verifying the VAT refund application dossiers of exporting enterprises in some localities, the Director of the General Department of Taxation requests the Directors of the Tax Department to urgently perform the following tasks:

- The Tax Department reviews the classification of VAT refund applications to ensure compliance with regulations. The Director of the Department directly assigned the Deputy Directors to review each application file for tax refund, especially the dossiers that have been classified, checked first, and refunded later to speed up the inspection and verification of tax refund conditions.

- For VAT refund application dossiers that the Tax Office has finished checking and determined to be eligible for refund, the tax refund will be processed immediately.

For the tax refund application dossiers of the exporting enterprises being examined and verified, which have passed the prescribed time limit for settlement, in case tax fraud has not been detected in the results of inspection and verification up to now, the tax offices shall base themselves on the dossiers and attached documents provided by enterprises to determine the tax amounts eligible for tax refund and make tax refund settlement according to regulations.

If, after the tax refund is processed, the tax authority discovers that the enterprise has made false declarations about the tax amount requested for refund, the enterprise must pay back the overpaid tax and late payment interest as prescribed, and at the same time, the enterprise shall take full responsibility before the law for its violations.

For dossiers where the Tax Authority detects fraudulent acts and signs to profit from tax refunds from the state budget, consolidate the dossiers to transfer to the police for investigation, and at the same time notify the enterprise in writing based on the conclusions of the competent authorities to handle according to regulations.

- Continue to arrange for additional officials and employees to participate in the settlement of VAT refund dossiers to speed up the tax refund process, especially the records of exporting enterprises, ensuring that by the end of September 2023, the VAT refund results will reach and exceed the same period in 2022.

Responsibilities of tax authorities for processing tax refund applications in Vietnam

Specifically, according to Article 27 of Circular 80/2021/TT-BTC, the responsibilities of tax authorities for processing tax refund applications in Vietnam are as follows:

(1) Cases of tax refund according to tax laws

- VAT refund according to VAT laws.

- Refund of excise tax according to excise tax laws on biological gasoline.

- Tax refund according to Double Taxation Agreements and other International Agreements to which the Socialist Republic of Vietnam is a signatory.

(2) Responsibility for receiving and processing applications for tax refund according to tax laws

(i) Provincial Departments of Taxation shall receive and process tax refund applications mentioned in (1) (except the cases specified in Point b and Point c of this Clause) submitted by taxpayers under management of Departments of Taxation and sub-departments of taxation.

Heads of Departments of Taxation of Hanoi, Ho Chi Minh City, Binh Duong province, Dong Nai province may assign sub-department of taxation to receive and process VAT refund applications from taxpayers under direct management of sub-departments of taxation, including the following tasks:

Classify tax refund applications eligible for tax refund before inspection or subject to inspection before refund; determine refundable tax; determine tax debt, fine, late payment interest to be offset against refundable tax;

Draft tax refund decisions or decisions on tax refund and state budget revenue offsetting (hereinafter referred to as "tax refund decision") or notification of rejected applications (if any); then transfer all documents to the Department of Taxation for completion according to Circular 80/2021/TT-BTC.

(ii) The Department of Taxation where the taxpayer declares VAT on the investment project according to Point a Clause 1 Article 11 of Decree 126/2020/ND-CP shall receive and process applications for refund of tax on the investment project of the taxpayer.

(iii)) Supervisory tax authorities shall receive and process applications for refund of input VAT that remains after deduction upon transfer of ownership, conversion of enterprises, consolidation, merger, full division, partial division, bankruptcy and shutdown of enterprises.

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