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Finance Minister urges reform of tax procedures

Update: July, 05/2014 - 11:18

HA NOI (VNS)— The tax authorities must continuously reform administrative procedures as there are many shortcomings, said Finance Minister Dinh Tien Dung at a conference in Ha Noi on Thursday.

Dung said that though the agency had made progress in reforming its tax procedures in recent years, it still had a long way to go in order to match regional standards.

He quoted the World Bank's 2014 report on business environment as saying that businesses in Viet Nam have to declare and submit taxes 32 times a year. An average of 872 hours are required to complete the procedures (it will take roughly 500 hours for tax paperwork if the time required for declaring and submitting social insurance, health-care and unemployment data is excluded).

The time taken is 4.98 times more than that of the OECD bloc, 4.1 times more than the Asia-Pacific countries and 5.1 times more than the other ASEAN countries.

Dung said that the tax authorities must try to cut down the time to roughly 200 to 300 hours.

General Director of Taxation Bui Van Nam affirmed that the tax agency would improve the administrative procedures to create the most favourable conditions for firms.

It would help firms cut costs, save time and boost production, which would contribute to increasing the tax collection, Nam said.

At the conference, the General Department of Taxation also reported that the country's tax collection in the first half of the year was estimated to be VND335.09 trillion or US$15.73 billion, up 14.5 per cent year over year and equal to 53.7 per cent of the annual tax collection plan.

The department reported that 46 of 63 cities and provinces nationwide in H1 met more than half of their tax collection plans.

The tax agencies in H1 also collected an additional VND4.119 trillion or $193.38 million, up 80.8 per cent year-on-year after the audits of 20,983 enterprises.

During the period, the agencies also inspected 557 firms which declared losses and showed signs of transfer pricing, and collected an additional VND580 billion or $27.23 million.

To increase the tax collection in the second half of the year, deputy director of the HCM City Taxation Department Le Xuan Duong suggested that during periods of economic difficulties, the Government should grant tax payment extension to more firms to prevent their closure if the firms have committed to pay their tax arrears. — VNS


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