The Taxation Sector to implement e-invoices nationwide
According to Mr. Vu Xuan Bach, Deputy Director General, General Department of Taxation: The Taxation sector will expand electronic tax registration, synchronize electronic invoice system. At the same time, strengthening information connection between the taxation sector and other state management agencies by electronic means to implement effective taxation management; promoting the integration of tax services into the national public service portal so that people and businesses can promptly access and carry out tax administrative procedures.
Mr. Vu Xuan Bach, Deputy General Director, General Department of Taxation. Photo: Quang Minh.
At the online forum "Proactive economic recovery and development in response to the epidemic" organized by the Vietnam Financial Times on October 27, 2021, Mr. Vu Xuan Bach, Deputy Director General, the General Department of Taxation answered a number of questions related to the tax sector's companionship with people and businesses in the context of the Covid-19 pandemic.
Question: In the context of many businesses facing a lot of difficulties caused by the Covid-19 epidemic, the entire Taxation Sector has actively implemented many solutions to support businesses. Mr. Vu Xuan Bach, could you share more about the taxation sector’s outstanding results; deployment of solutions to support, remove difficulties and accompany businesses; as well as further implementation of tax system reform?
Answer: Since the Covid-19 epidemic broke out in Vietnam, right in 2020, many supporting policies on taxes, fees and state budget revenues have been issued by competent authorities to support businesses and people.
Those issued by the Government and the Prime Minister include: the Decree No. 41/2020/ND-CP dated April 8, 2020 of the Government on extending the deadline for paying land tax and rent; the Decree No. 109/2020/ND-CP dated September 15, 2020 of the Government on extending the deadline for paying excise tax for domestically manufactured and assembled automobiles; the Decision No. 22/2020/QD-TTg dated August 10, 2020 of the Prime Minister on the reduction of 15% of payable land rent in 2020 applicable to land rent payers.
Those issued by the National Assembly, the National Assembly Standing Committee include: the Resolution No. 107/2020/QH14 dated June 10, 2020 of the National Assembly on extension of the time limit for payment of agricultural land use tax exemption; the Resolution No. 116/2020/QH14 dated June 19, 2020 of the National Assembly on reduction of 30% corporate income tax payable amount in 2020; the Resolution No. 954/2020/UBTVQH14 dated June 2, 2020 of the National Assembly Standing Committee reducing the obligations of personal income taxpayers by increase of the family circumstances-based reduction level; the Resolution No. 979/2020/UBTVQH14 dated July 27, 2020 of the National Assembly Standing Committee on a 30% reduction of the environmental protection tax applicable to jet fuel from August 1, 2020 to the end of December 31, 2020 to support the aviation industry.
In addition, the Ministry of Finance has presided over and coordinated with relevant ministries to review and issue 21 Circulars amending to 31 Circulars on collection of current fees and charges towards exempting or reducing the rates of various kinds of fees and charges.
Over the past time, the taxation sector has quickly and effectively deployed solutions to each group of policy beneficiaries.
In 2021, the Ministry of Finance has reported to competent authorities or within the ministry’s power issued various solutions on taxes and fees to further support businesses in terms of capital sources and cash flows, specifically: continue to reduce environmental protection tax on jet fuel until the end of December 31, 2021 (the Resolution No. 1148/2020/UBTVQH14 dated December 21, 2020 of the National Assembly Standing Committee, which takes effect from January 1, 2021); Continue to reduce the collection rates of more than 30 fees and charges.
Submitting to the Government for promulgation of the Decree No. 44/2021/ND-CP dated March 31, 2021 providing guidance on deductible expenses upon determination of income liable to corporate income tax for contributions and donations given by enterprises and organizations for COVID-19 epidemic prevention and control activities, applied in 2020 and 2021.
Submitting to the Government for promulgation Decree No. 52/2021/ND-CP dated April 19, 2021 on extension of tax payment deadlines (value added tax, corporate income tax, personal income tax) and land rents in 2021 for subjects facing difficulties due to the impact of the Covid-19 epidemic.
Submitting to the Prime Minister for promulgation of the Decision No. 27/2021/QD-TTg dated September 25, 2021 on the 30% reduction of land rent in 2021 for those affected by the Covid-19 epidemic.
Submitting to the Government to report to the National Assembly Standing Committee for issuance of the Resolution No. 406/NQ-UBTVQH15 dated October 19, 2021 on a number of solutions to support businesses and people affected by the Covid-19 epidemic. The Resolution 406/NQ-UBTVQH15 specifies 4 supporting solutions as follows: reducing 30% corporate income tax; exempting household and individual business taxes; reducing 30% of value-added tax on some goods and services; exempting fines for late payments of taxes, land use levies and land rents.
It is estimated that the total amount to support businesses and people facing difficulties due to the impact of the Covid-19 pandemic under those tax and fee solutions issued in 2021 reach about VND 138 trillion (of which the amount of taxes and land rents subject to extension of payment deadline is about VND115 trillion; exempted and reduced amount is about VND 23 trillion).
At the same time, the taxation sector has strictly controlled administrative procedures in combination with modernization in tax administration in order to maximize facilitation to people and businesses, improve the business environment, enhance national competitiveness.
Question: Dear Mr. Vu Xuan Bach, businesses and people must "adapt" the current context, so surely the taxation sector can not stand aside. What shall the taxation sector do in order to "match" with businesses’ changes due to the epidemic?
Answer: In order to accompany with businesses in epidemic context, the Taxation sector has promptly supported and created all favorable conditions for declared businesses to enjoy tax and fee supporting policies approved by competent authorities with simple procedures and by online form.
At the same time, to match the changes in businesses’ digital transformation process, the Taxation sector continues to expand the implementation scope of electronic tax system to the following services: electronic tax declaration, electronic tax payment, electronic tax refund, electronic invoice. Number of businesses participated in e-tax declaration and e-tax payment accounts for more than 99.6% and 98.7% respectively. Promoting electronic tax services implementation has facilitated both taxpayers and tax authorities in the context of the Covid-19 epidemic.
Question: The General Department of Taxation is about to deploy e-invoices in 6 provinces and cities, proceeding to apply e-invoices across the country. Is this one of the solutions to facilitate businesses, people and also the Taxation sector’s "adaptation" in the current context? Could you please share more about this issue?
Answer: Application of e-invoice shall be one of the Taxation sector’s breakthrough solutions to transform the way to serve peoples and businesses, facilitate businesses reducing costs, improving operational efficiency as well as to transform the Taxation’s management method to adapt to the new condition. E-invoice is implemented in accordance with the Law on Tax Administration No. 38/2019/QH14 approved by the National Assembly on June 13 2019, the Decree No. 123/2020/ND-CP dated October 19, 2020 of the Government and the Circular No. 78/2021/TT-BTC dated September 17, 2021 of the Ministry of Finance, which shall take effective from July 1, 2022.
Currently, the application of e-invoice has been piloted in 06 provinces and cities including Hanoi, Ho Chi Minh, Quang Ninh, Binh Dinh, Phu Tho and Hai Phong (in accordance with the Decisions No. 1830/QD-BTC, No. 1832/QD BTC, No. 1831/QD-BTC, No. 1833/QD-BTC, No. 1838/QD-BTC, and No. 1839/ QD-BTC of the Ministry of Finance).
With respect to businesses, using e-invoices under the Taxation’s standard format and transferring data to the tax authorities will help businesses reduce the cost of paper, printing ink, mailing cost and especially invoices storage cost. Businesses shall not have to make reports on invoices usage, while saving time to make value-added tax (VAT) declaration as e-invoices data is automatically connected to VAT declaration software. Upon submitting tax refund dossiers, businesses shall not be required to submit list of invoices related to determination of VAT refundable amount. As using digital signatures, e-invoice ensures high security, so that using e-invoices to replace paper invoices has contributed to preventing and overcoming invoices counterfeiting.
With respect to tax authorities, use of e-invoice helps tax administration to be more effective as information technology system can easily track and check invoices in order to quickly and promptly detect acts of using illegal invoices, using false invoices to commit frauds in VAT refund, in cost accounting as well as in payment of budget capital.
The application of e-invoice in 6 provinces and then expanding across the country will realize the Government's targets in "Digital Transformation" policy implementation, create favorable conditions for the business community and people, contribute to building the taxation sector towards modernization, transparency, professionalism in tax services provision.
Question: From the closest perspective to businesses, would the leaders of the General Department of Taxation have recommendations for the business community to take advantage of the support and opportunities to transform, recover and develop?
Answer: Each tax and fee support solution clearly defines the subject of application, specific application time, simplest and most convenient procedure for taxpayers. The tax authorities have carried out extensive and complete propaganda program. However, in order to take advantage of the supports, businesses shall proactively monitor, study the policies and procedures for applying thereof, especially those policies with specific deadlines for submission of dossiers and proposals, and implement in accordance with regulations.
In the long term, businesses need to promote dynamism, creativity, application of new business forms, digital transformation to overcome difficulties and challenges, and promote production and business. At the same time, business community needs to accompany with authorities and people in effective epidemic prevention and fighting in order to soon recover and develop in a "new normal" context.
Question: During implementation of policies on extension of taxes and land rents payment deadlines according to the Decree 41/2020/ND-CP and Decree 52/2021/ND-CP, it is reported that the number of businesses submit applications is less than expected. Could you please tell about the reasons?
Answer: The results of the implementation of extension policies on tax and land rents were lower than expected, mainly due to the impact of the Covid-19 epidemic, which had a negative impact on production and business in many fields and industries, especially businesses in localities where must implement social distancing to prevent and control the epidemic, resulting in a lower tax amount subject to payment deadline extension than expected. A lot of businesses where incurred small or no tax payable amount due to business suspension did not apply for deadline extension of taxes and land rents payment.
Question: In the current epidemic situation, computerizing budget collection and payment plays an important role, not only to facilitate people and businesses, but also limit people gathering to avoid disease spreading. In addition to solutions such as electronic tax declaration and payment, electronic tax refund, what other solutions shall the General Department of Taxation issue in the near future?
Answer: Currently, most businesses have applied electronic services in transactions with tax authorities. Therefore, the Taxation sector will keep maintaining and expanding forms of electronic transactions to receive and handle tax administrative procedures from level 3 or higher.
Accordingly, the Taxation sector will expand electronic tax registration and synchronize electronic invoices. At the same time, strengthen information connection between the Taxation sector and other state management agencies by electronic means for effective tax management; promote the integration of tax services into the national public service portal so that people and businesses can quickly access and carry out tax administrative procedures.
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