The planned tax debt elimination contains interest and administrative fines on late payments but does not include the original debts. (Photo: daidoanket.vn) Hanoi (VNS/VNA) - The General Department ofTaxation (GDT) has proposed to erase 12 trillion VND (516 million USD) out oftotal 30 trillion VND irrecoverable tax debts.
The planned tax debt elimination contains interest andadministrative fines on late payments but does not include the original debts, saidLuu Duc Huy, Director of the GDT’s Policy Department.
In recent years, the National Assembly has amended andsupplemented many tax laws, leading to changes in tax policies. However, noregulations on resolving outstanding tax debts in the long run have beenpromulgated.
The Government has assigned the Ministry of Finance to reviewand complete the draft resolution on clearing tax debts that are not able to becollected and submit it to the National Assembly Standing Committee forcomments, which will be included in the 2019 law and ordinance buildingprogramme.
The proposed deletion is applicable for seven groups oftaxpayers including those who died, were missing and lost civil act capacity,and enterprises who went bankrupt, were dissolved, terminated businessoperation, did not operate at the registered business addresses, had businessregistration certificates revoked or faced force majeure hardship, Huytold tienphong.vn.
According to GDT, the total outstanding debts reached around 30trillion VND (1.29 billion USD) by the end of 2018, of which tax arrears weremore than 17 trillion VND, interests and penalties for late payments werenearly 12 trillion VND.
There are many reasons for this situation. First of all,there are 2,635 taxpayers who were dead, missing or lost civil act capacitywith tax debts of 460 billion VND.
There are 24,113 enterprises that were dissolved but did notfollow dissolution procedures and they owed tax of 2.07 trillion VND. Inaddition, 216 enterprises were insolvent and went bankrupt but failed to paytax of 398 billion VND.
Notably, there are about 731,696 taxpayers abandoning theirbusiness addresses or having their business registration certificates revokedwho owed tax amounts of nearly 23.9 trillion VND.
“The Tax Administration Law stipulates that the late paymentinterest is 0.03 percent per day on the overdue payments. This is a necessarysanction,” GDT said.
Total fines and interest on late payments of all mentionedabove taxpayers reached 12 trillion VND by the end of 2018 but were unable tobe collected, the taxation authority said.
In cases the authority finds out the tax debt elimination didnot follow the law or the taxpayer resumes production or business operation orestablishes a new business, the elimination decision would be cancelled, andthe taxpayer must still pay the tax debt, it said.
This resolution will take effect on January 1 next year andwill be implemented within three years from the effective date.-VNS/VNA
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