From January 1, 2018, the Criminal Code 2017 will officially come into force and apply in the imposition of criminal penalties against corporate legal entities, including provisions on criminal liability for tax evasion by enterprises engaged in production and business in Vietnam.
Article table of contents
The enterprise in Vietnam will be fined from 300 million to 1 billion VND if: evading tax with an amount from 100 million to less than 200 million VND while having incurred an administrative penalty for tax evasion or having an unspent conviction for any of the offences specified in Article 188, 189, 190, 191, 192, 193, 194, 195 and 196 of the Criminal Code 2015, or evading tax with an amount from 200 million to less than 300 million VND by committing one of the following acts:
- Failing tosubmit the application for tax registration; failing tosubmit tax declaration; failing tosubmit tax declarations on schedule as prescribed by law;
- Failing torecord revenues related to the determination of tax payables in accounting books;
- Failing toissue invoices after selling goods/services or write lower values on invoices than actual values of goods/services sold;
- Using illegal invoices or vouchers to record purchased goods and raw materials that results in reduction of tax payable or increase exempt, reduced, deductible or refundable tax;
- Using other illegal documents to falsify the amount of tax payable or increase exempt, reduced, deductible or refundable tax;
- Making incorrect declaration of exported or imported goods without making an additional declaration after customs clearance are granted;
- Deliberately omitting tax or declaring incorrect tax on exported or imported goods;
- Colluding with the shipper to import goods;
- Using tax-free goods, goods eligible for tax exemption or conditional tax exemption for improper purposes without notifying the change of purposes to the tax authority.
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Article 200. Tax Evasion 5. Punishments incurred by a corporate legal entity that commits any of the offences specified in this Article:: a) Any corporate legal entity that commits any of the acts of tax evasion specified in Clause 1 of this Article with an amount of from VND 200,000,000 to under VND 300,000,000 or from VND 100,000,000 to under VND 200,000,000 while having incurred an administrative penalty for tax evasion or having an unspent conviction for any of the offences specified in Article 188, 189, 190, 191, 192, 193, 194, 195 and 196 hereof shall be liable to a fine of from VND 300,000,000 to VND 1,000,000,000; |
Additionally, a fine of 1 billion to 3 billion VND may be imposed on the enterprise committing tax evasion in any of the following cases:
- The offence is committed by an organized group;
- The amount of tax evaded is from VND 300,000,000 to under VND 1,000,000,000;
- The offence has been committed more than once;
- Dangerous recidivism.
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… b) A corporate legal entity that commits this offence in any of the circumstances specified in Points a, b, d and dd Clause 2 of this Article shall be liable to fine of from VND 1,000,000,000 to VND 3,000,000,000; … |
A maximum fine of 10 billion VND or suspension from operation for 3 to 6 months may be imposed if the enterprise evades tax over 1 billion VND. In cases where tax evasion causes serious and irreparable consequences, the enterprise will be permanently prohibited from operating.
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… c) A corporate legal entity that commits this offence in any of the circumstances specified in Clause 3 of this Article shall be liable to a fine of from VND 3,000,000,000 to VND 10,000,000,000 or has its operation suspended for 06 - 36 months; d) A corporate legal entity that commits this offence in the circumstance specified in Article 79 hereof shall be permanently shut down; … |
Concurrently, in addition to the fines mentioned above, the enterprise evading tax shall also face additional penalties, including a fine from 50 million to 200 million VND, suspension from operating or engaging in certain activities, or raising capital for 01 year to 03 years.
- Key word:
- enterprises evading taxes
- Vietnam
- fine
