Handling tax debts effectively

As of late June lasy year, the Customs sector collected had VND369 billion in tax debts.

Local customs departments achieved positive results in tax debt collection like Bac Ninh at VND96.6 billion, Hai Phong at VND72.5 billion, Hanoi at VND60.1 billion, Binh Duong at VND34 billion and Khanh Hoa at VND20.36 billion.

As of June 30, total overdue tax debts was VND5,503.13 billion, down VDN157.31 billion compared with late December 2020.

As of late June 2021, total tax debts were VND115, 983 billion, down 4.8% year-on-year.

However, the rate of total tax debt to total State budget revenue hit 10.4% higher than that of 3% in the end of 2020 and 5.4% of the target assigned by the Government, according to the General Department of Taxation.

Taxpayers have suffered from difficulties due to the two outbreaks of the Covid-19 pandemic, and the application of the Government Directive 15 and Directive 16 on social distancing measures in many localities. So that they have not yet paid taxes, leading to the increase in tax debts.

In addition, some taxpayers subject to enjoy extended tax payment deadlines have not yet submitted applications for the extension of tax debt payment, making total tax debts rise.

Facing this situation, the tax and Customs sectors have provided solutions to reduce tax debts to the lowest level.

The General Department of Vietnam Customs (GDVC) has asked units to carry out plans on tax debt collection and strengthen tax debt management.

They must classify tax debt groups of recoverable and irrecoverable debts to assign target to local customs departments, a representative of Import and Export Duty Department said.

The tax sector has reviewed and classified debts, analysed the debt causes of each tax debtor, and made a list of tax debtor. Especially, classify taxpayers affected by the Covid-19 pandemic, applying appropriate measures for debt collection.

Difficult tasks

According to Director of Import and Export Duty Department Le Nhu Quynh, in the last months of the year, the public health crisis has impacted enterprises’ operation and debt collection. The bad debt amount is VND3,800 billion, while the pending debt amount is VND68 billion.

As of end December, the tax sector must collect at least 80% of recoverable tax debts and reduce the tax debt ratio to less than 5% of total revenue in 2021. These are formidable tasks.

To fulfill the task and decline the tax debt ratio to the lowest level, the General Department of Taxation directed the Import and Export Duty Department to provide solutions for debt collection.

The GDVC has told local customs departments to review overdue 90-day tax debts and employ coercive measures for debt collection.

To prevent revenue loss and collect outstanding debts, Customs works with other authorities to decide temporarily suspend exit for tax debtors, business owners and legal representatives of enterprises as prescribed in Clause 1, Article 21 of Decree 126/2020/ND-CP.

The tax sector continues to review and handle large tax debtors, make list of tax debtors, and request tax authorities to collect new arising debts, preventing bad debt.

It also urges tax authorities to collect taxes and land rentals where the payment deadline has expired, and limit new debts.

The tax authority will focus on collecting green tax debt and determining debts related to land use, land rentals and granting mineral mining rights. If land users fail to pay these debt amounts, the tax will ask the People's Committee to recover the land.