To strengthen tax administration in organizations and individuals doing game business in Vietnam

To strengthen tax administration in organizations and individuals doing game business in Vietnam (Internet image)

On June 19, 2024, the General Department of Taxation (Hanoi, Vietnam) issued Official Dispatch 2631/TCT-TTKT regarding the strengthening of tax administration for organizations and individuals in the game business sector.

To strengthen tax administration in organizations and individuals doing game business in Vietnam

Through tax administration activities concerning businesses in the game sector (both online and offline), the General Department of Taxation has observed that several game publishers and developers have significantly expanded their business activities in recent years. Therefore, to continue enhancing tax administration efforts and preventing tax losses in this business type, the General Department of Taxation requires the provincial and regional Tax Departments:

• Strengthen tax administration efforts for organizations and individuals in the game business sector within their jurisdictions. Proactively review, categorize, monitor, oversee, develop lists, and regularly update the status information and risk evaluations for these organizations and individuals to implement appropriate tax administration measures in accordance with regulations.

• Conduct dossier inspections at the Tax Authority headquarters as prescribed, and concurrently apply risk management principles in tax administration to develop inspection and audit plans at taxpayer headquarters for businesses as per the regulations.

• Collaborate closely with local competent authorities to ensure strict management and minimize risks in tax administration for this business type. If any violations of tax laws and criminal indications are detected through inspections and audits, the dossiers should be transferred to the investigative authorities for handling as per legal regulations.

• In the event of receiving requests from Tax Departments in other provinces or regions for coordination in reviewing organizations and individuals in the game business sector, the General Department of Taxation requests proactive and serious cooperation.

Further details can be found in Official Dispatch 2631/TCT-TTKT dated June 19, 2024.

Rules for tax administration in Vietnam

• All organizations, households, business households, and individuals are obligated to pay taxes as mandated by law.

• tax administration authorities, along with other state authorities tasked with revenue management, execute tax administration activities as per this Law and related legal regulations, ensuring transparency, fairness, and the rights and legitimate interests of taxpayers.

• Entities and individuals are responsible for participating in tax administration as prescribed by law.

• Implement administrative reforms and apply modern information technology in tax administration; adopt international tax administration principles, including the substance-over-form principle and risk management principles suitable to Vietnam's conditions.

• Apply preferential measures when carrying out tax procedures for exported and imported goods according to customs law and government regulations.

(Article 5 of the Law on Tax administration 2019)

Prohibited activities in tax administration in Vietnam

• Collusion or complicity between taxpayers and tax administration officials or organizations to transfer pricing or evade taxes.

• Causing inconvenience or harassment for taxpayers.

• Misappropriating or illegally using tax money.

• Willfully failing to declare or improperly, inaccurately, or untimely declaring tax amounts due.

• Obstructing tax administration officials in executing their duties.

• Using another taxpayer's tax identification number for illegal activities or allowing others to use one’s tax identification number contrary to legal regulations.

• Selling goods or providing services without issuing invoices as required by law, using illegal invoices, or improperly using invoices.

• Tampering with, misusing, illegally accessing, or destroying taxpayer information systems.

(Article 6 of the Law on Tax administration 2019)

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