A conference on transfer pricing, including strategies for tax management agencies to tackle the issue, was held in Hanoi on October 29.
Managers and experts said pricing transfer and tax avoidance is a global issue.
Nguyen Van Phung, Deputy Director of the Department for Tax Administration of Major Corporations under the Ministry of Finance’s General Department of Taxation, said enterprises tend to evade tax payments by exploiting loopholes in the legal system. The challenge to management agencies is how to detect law violations in such behaviours.
Director of the Ministry of Planning and Investment’s Foreign Investment Agency Do Nhat Hoang said it is essential to uncover evidence of transfer pricing, which aims to dodge tax duties, and penalise violators according to the legal framework.
Economic expert Nguyen Minh Phong presented his analysis of the issue, saying that transfer pricing is used by enterprises to avoid tax, which distorts the investment climate, reduces the efficiency of state management, creates a high risk of corruption, and causes losses in State revenue.
Successfully combating transfer pricing depends on legal mechanisms and policies, as well as the professional skills of tax officers, participants noted.
In order to maximise State efforts, the Government assigned the Ministry of Planning and Investment to work with relevant agencies and authorities to set up an anti-transfer pricing project.
The Ministry of Finance, which was commissioned to implement the project, has focussed on developing training programmes, running communication campaigns and implementing a number of other measures in an effort to detect and deal with firms that show signs of transfer pricing.
Over the last 26 years, foreign direct investment has played a crucial role in boosting Vietnam’s socio-economic development, generating more funds for the State budget and increasing the country’s integration into the global economy. However, the rise in cases of transfer pricing and tax evasion has harmed the country’s investment environment.
According to the General Department of Taxation, out of the 39,000 firms that were inspected by tax agencies during the first eight months of this year, nearly 2,000 showed signs of transfer pricing. The agencies collected over 1 trillion VND in fines (47 million USD).-VNA
Managers and experts said pricing transfer and tax avoidance is a global issue.
Nguyen Van Phung, Deputy Director of the Department for Tax Administration of Major Corporations under the Ministry of Finance’s General Department of Taxation, said enterprises tend to evade tax payments by exploiting loopholes in the legal system. The challenge to management agencies is how to detect law violations in such behaviours.
Director of the Ministry of Planning and Investment’s Foreign Investment Agency Do Nhat Hoang said it is essential to uncover evidence of transfer pricing, which aims to dodge tax duties, and penalise violators according to the legal framework.
Economic expert Nguyen Minh Phong presented his analysis of the issue, saying that transfer pricing is used by enterprises to avoid tax, which distorts the investment climate, reduces the efficiency of state management, creates a high risk of corruption, and causes losses in State revenue.
Successfully combating transfer pricing depends on legal mechanisms and policies, as well as the professional skills of tax officers, participants noted.
In order to maximise State efforts, the Government assigned the Ministry of Planning and Investment to work with relevant agencies and authorities to set up an anti-transfer pricing project.
The Ministry of Finance, which was commissioned to implement the project, has focussed on developing training programmes, running communication campaigns and implementing a number of other measures in an effort to detect and deal with firms that show signs of transfer pricing.
Over the last 26 years, foreign direct investment has played a crucial role in boosting Vietnam’s socio-economic development, generating more funds for the State budget and increasing the country’s integration into the global economy. However, the rise in cases of transfer pricing and tax evasion has harmed the country’s investment environment.
According to the General Department of Taxation, out of the 39,000 firms that were inspected by tax agencies during the first eight months of this year, nearly 2,000 showed signs of transfer pricing. The agencies collected over 1 trillion VND in fines (47 million USD).-VNA
