In June 2019, the National Assembly voted to approve the revised Law on Tax Management with 91.32% of the deputies approval. The Tax Management Law (revised), comprising of 17 chapters with 152 articles, regulates the management of all forms of tax and other state budget revenues, as well as the rights and obligations of taxpayers.
In the spirit of ensuring publicity, transparency, equality and the legitimate rights and interests of taxpayers, the Law requires reform of administrative procedures as well as the application of modern technology and international principles in accordance with the condition’s of The Socialist Republic of Vietnam. Accordingly, the Law not only governs the functioning of authorities, but also facilitates taxpayers to fulfill their obligations, as well as expanding their rights. Therefore, it is important for enterprises and individuals to follow the implementation of the Law in practice, as well as future guiding regulations to carry out necessary changes in a timely manner, avoiding issues and stagnation in business.
In term of taxpayers’ rights, according to the revised Law, taxpayers have the right to receive a deadline for the settlement of tax refunds, non-refundable tax amounts and legal grounds for non-refundable tax amounts for the tax authority. The application of modern technology in tax management is also a focus, most tax-relevant activities and reports must be conducted through the online portal of the tax management authority. An electronic platform will be provided for taxpayers to view and print all electronic documents they sent to the online portal.
For the first time, a Tax law regulates fiscal management for e-commerce activities, which thereby regulates: “For e-commerce business, digital based business and other services performed by overseas suppliers without a permanent establishment in Vietnam, overseas suppliers have the obligation to directly or authorize the tax registration, tax declaration and payment in Vietnam according to the regulations of the Minister of Finance.” However, at the moment these provisions in the Tax Management Law only serves as a foundation, a basis for the relevant ministries and agencies to issue detailing guideline regulations for e-commerce business activities.
The new law also supplements the duties of the ministries and central agencies in tax administration, decentralization and extending the competence to decide on tax debt remission.
Regulations on prohibited acts in tax management are also more explicit, including: collusion and cover between taxpayers and tax management officials to commit tax fraud, intentionally causing difficulties for taxpayers; the use of tax money without authorization; intentionally not declaring tax, hindering tax officials from performing their duties; the usage of another person’s tax code or allowing others to use your tax code illegally; not issuing invoices when providing goods and services or issue, or the usage of illegal invoices.
The new law will take effect from July 2020, in which some regulations on invoices and electronic documents separately will take effect from July 2022.