Decree No. 89/2002/ND-CP dated November 07, 2002 of the Government the printing, issuance, use and administration of invoices

DECREE

THE PRINTING, ISSUANCE, USE AND ADMINISTRATION OF INVOICES

THE GOVERNMENT

Pursuant to the Law on Organization of the Government dated 25 December 2001; Pursuant to the current laws and ordinances on tax;

Pursuant to the Ordinance on Accounting and Statistics dated 20 May 1988;

Pursuant to the Ordinance on Dealing with Administrative Offences dated 2 July 2002; On the proposal of the Minister of Finance;

DECREES:

Chapter I

GENERAL PROVISIONS

Article 1.Governing scope and applicable subjects

This Decree shall apply to organizations and individuals who have rights and obligations pursuant to law for the printing, issuance, use and administration of invoices.

Article 2.Types, forms and contents of invoices

1. The types of invoices governed by this Decree shall comprise:

(a) Value added invoices.

(b) Sale of goods invoices.

(c) Procurement invoices.

(d) Other types of invoices.

2. Invoices shall be made in one of the following forms:

(a) Invoices printed on a sample form.

(b) Invoices printed following a stipulated form from a cash register.

(c) All types of stamps and tickets with a face value printed on them.

3. Invoices shall only have legal validity when their contents include all the criteria stipulated by the regulations.

4. The Ministry of Finance shall provide regulations on the forms of, and the contents of criteria on invoices.

Article 3.The following terms in this Decree shall be construed as follows:

1. Invoice means any voucher which is printed on a sample form, printed from a cash register or printed as a ticket with a face value in accordance with State regulations, fixing the quantity and value of goods or services purchased, sold or exchanged and fixing the rights and obligations of parties participating in the transaction of purchase, sale or exchange of goods or services.

2. Self-printed invoice means an invoice which an organization or individual is permitted to print, or permitted to order to have printed, in accordance with a prescribed form.

3. Issuance of an invoice means an organization or individual introduces into use an invoice which has already been printed.

4. Invoice symbol means the sign classifying the invoice by a system of Vietnamese letters plus the year of issuance of the invoice.

5. Invoice number means a number following a consecutive order and following a row of natural numbers in the invoice symbol.

6. Duplicates/counterfoils means the papers jointly making up one invoice number.

7. To prepare an invoice means to use the necessary facilities in order to fully record information on an invoice following the criteria.

8. Blank invoice means an invoice which has been prepared but does not contain contents of a transaction.

9. False invoice means an invoice which an organization or individual does not have the right to print or to issue.

Article 4.Prohibited conduct

It is strictly prohibited for any organization or individual to print, issue, use, administer, purchase or sell an invoice contrary to the provisions in this Decree.

Chapter II

PRINTING, ISSUANCE, USE AND ADMINISTRATION OF INVOICES

Article 5.Printing invoices

1. The Ministry of Finance shall print invoices for issuance and sale to organizations and individuals to use in accordance with the laws and ordinances on tax.

2. Organizations and individuals shall be permitted to self-print invoices in accordance with the provisions in this Decree and guidelines of the Ministry of Finance.

Article 6.Responsibilities of organizations and individuals who self-print invoices

1. When organizations and individuals who are permitted to self-print invoices place an order for printing invoices, they must correctly follow the sample approved by the head of their organization, they must write their full name and sign the sample form which they send to the organization accepting the printing of invoices, and they must have a contract for printing invoices with such organization which specifies the quantity of invoices, the invoice symbols, and the range of consecutive numbers of the invoices. After each printing occasion or on termination of a printing contract, the parties must liquidate the contract.

2. Prior to printing a new tranche of invoices, a report must be made to the tax office on the use of the former tranche and the following items of the new tranche to be printed must be registered: invoice symbols, quantity of invoices, the range of consecutive numbers and the place of printing.

Article 7.Conditions for, and responsibilities of organizations accepting the printing of invoices

1. Organizations which accept the printing of invoices must satisfy the conditions for practising printing in accordance with law.

2. Invoices must be printed using a sample form approved in writing by the Ministry of Finance, and must be compared with the sample form which was approved by the competent person and provided [to the printer] when the order for printing was made; invoices must be printed correctly in accordance with the contract signed by the person making the order, which contract must specify the quantity of invoices, the invoice symbols and the range of consecutive numbers of the invoices. After printing is finished, there must be liquidation of the contract, and the following things must be destroyed: the printing board, the print stereotype, any excess products printed and any damaged prints.

3. A register shall be opened to monitor any orders for printing, and every quarter a report must be made and sent to the tax office on the quantity of invoices printed by each organization and individual placing an order for printing.

Article 8.Issuance of invoices

1. The Ministry of Finance shall issue invoices. When organizations and individuals introduce self-printed invoices into use, they must provide written notice of the fact of issuance [to the Ministry of Finance?] and specify the type, form, sample and use period of the invoices. Organizations and individuals shall be legally liable for the invoices whose issuance they notify.

2. When organizations and individuals purchase invoices issued by the Ministry of Finance, they must write or seal their name, address and tax code number on two duplicates of each invoice number at the office of the agency issuing the invoices.

3. The Ministry of Finance shall provide regulations on procedures for purchasing invoices, and on procedures for registering the use of invoices.

Article 9.Use of invoices

1. Applicable to organizations and individuals who sell goods and services:

(a) On the sale or exchange of goods and services, an invoice must be prepared and handed to the client in accordance with law.

In the case of retail sale of goods or provision of services with a value below a stipulated level and the purchaser does not request an invoice, it is not compulsory to prepare one. The Ministry of Finance shall regulate the specific monetary level at which it is not compulsory to prepare an invoice.

(b) When preparing an invoice, all the printed criteria must be filled in fully and correctly, and any criteria not filled in must be crossed out. Contents written on any one occasion on duplicates making up the one invoice number must resemble each other.

(c) Invoices must be used in their correct consecutive order moving from small numbers to larger ones, without jumping a number. If an error is made and it is necessary to invalidate an invoice, it must be diagonally crossed out and the word “rescinded” written clearly and all duplicates of the rescinded invoice must be retained.

(d) Invoices not yet used and invoices already used must be preserved and archived in accordance with the laws on tax and the laws on accounting and statistics.

(dd) A monthly report must be made on the status of use of invoices by the 10th day of the following month at the latest, and an annual report must be made on finalization of use of invoices by 25 February of the following year at the latest, to the office which provided the invoices or where their use was registered.

(e) On merger, consolidation, dissolution, conversion of form of ownership, bankruptcy or interruption1 of operations, a report must be made on finalization of use of invoices as well as handing in all unused invoices to the office which provided the invoices or where their use was registered, within 15 days at the latest from the date of the decision on merger, consolidation, dissolution, conversion of form of ownership, bankruptcy or interruption of operations.

(g) When there is a change of sample form invoice there must be a public declaration of the quantity and type of invoices no longer valid for use, as well as finalization of, and handing in all unused invoices to the tax office.

2. Applicable to organizations and individuals who purchase goods and services:

(a) Organizations and individuals who purchase goods and services shall have the right and obligation to request the organization or individual selling the goods and services to prepare and handover the second duplicate for archiving and use in accordance with law.

(b) With respect to production and trading organizations and individuals who declare and pay tax, entities which are beneficiaries of State budget funds, and entities implementing projects which purchase goods and services, they shall be responsible to check the contents of the criteria recorded on invoices and refuse to accept any invoice on which incorrect criteria are recorded or which record different values on duplicate invoices retained by each party.

(c) Organizations and individuals who purchase goods and services for consumption and who properly retain invoices shall enjoy the benefits of the use of invoices in accordance with the regulations of the Ministry of Finance.

Article 10.Use of invoices to procure agricultural, forestry or aquatic goods

1. Where organizations and individuals procure goods being unprocessed agricultural, forestry or aquatic goods from sellers being direct producers who do not have a sales invoice, such purchasers must prepare a procurement invoice and hand it to the seller; if goods worth one million dong or more are procured, or if goods are purchased on many occasions from the same seller, the seller’s citizen identity card shall be relied on to record the full name and address of the seller, the quantity, unit price and total sum paid, and the seller must be asked to sign his name and to accept the second duplicate of the invoice.

2. Organizations and individuals producing agricultural, forestry or aquatic goods and directly selling them to purchasers must ask such purchasers to prepare a procurement invoice and hand it to the seller in accordance with the provisions in clause 1 of this article; and they shall be responsible to retain procurement invoices so that the invoices can be used for comparison purposes when necessary.

If goods worth one million dong or more are sold, or if goods are sold on many occasions to the same purchasing entity or individual procuring goods, [the seller] must present his citizen identity card so that the purchaser may prepare an invoice and correctly record all the criteria in accordance with the provisions in clause 1 of this article.

Article 11.Administration of invoices

1. Applicable to the Ministry of Finance: [It shall:]

(a) Guide and open a register to monitor in-coming and out-going invoices, and to register their use and finalization of use in accordance with the regulations.

(b) Regularly provide a plan for inspection of use and for administration of invoices which organizations and individuals print, issue and use.

(c) Preserve and administer invoices, and not allow them to be damaged or lost.

(d) Notify any loss of invoices2. Reclaim any invoices which are unused due to: merger, dissolution or interruption of operations of an entity registering the use of invoices, changing the sample form of invoices, re-finding invoices which were notified as having been lost, printing invoices with overlapping symbols or numbers, or torn invoices which need to be destroyed.

When invoices are reclaimed for destruction, a list shall be prepared of the criteria, invoice symbols, quantity and numbers in consecutive order of the invoices to be destroyed. The Ministry of Finance must approve any destruction of invoices, and a Liquidation Council must be established in accordance with regulations of the Ministry of Finance.

2. Applicable to organizations and individuals using invoices: [They shall:]

(a) Use invoices correctly in accordance with the regulations; not purchase, sell or give invoices to other organizations and individuals; not use invoices of other organizations and individuals; not use invoices to make fraudulent tax declarations or fraudulent accounting finalizations.

(b) Open a monitoring register, and have internal management rules and facilities to preserve and archive invoices in accordance with law. Not allow the destruction or loss of invoices.

(c) Immediately provide written notification of any loss of an invoice to the office which issued the invoice or where its use was registered.

(d) Regularly inspect the use of invoices in accordance with law.

Chapter III

DEALING WITH ADMINISTRATIVE BREACHES

Article 12.Fines for administrative breaches regarding printing of invoices

1. Applicable to organizations and individuals who order printing of invoices:

(a) A fine of from 1,000,000 dong to 5,000,000 dong shall be imposed for ordering printing of invoices without the competent State body providing written approval for the invoice form.

(b) A fine of from 4,000,000 dong to 9,000,000 dong shall be imposed for ordering printing of invoices with overlapping symbols or numbers.

2. Applicable to organizations which accept orders for printing invoices:

(a) A fine of from 1,000,000 dong to 5,000,000 dong shall be imposed for accepting an order for printing invoices without the competent State body providing written approval for the invoice form.

(b) A fine of from 4,000,000 dong to 9,000,000 dong shall be imposed for accepting an order for printing invoices with overlapping symbols or numbers.

Article 13.Applicable to breaches regarding registration or issuance of invoices

1. A fine of from 500,000 dong to 1,000,000 dong shall be imposed on an organization or individual who uses an invoice without providing a notice of issuance of invoice.

2. A fine of from 1,000,000 dong to 2,000,000 dong shall be imposed on an organization or individual who uses a self-printed invoice without registering use of the invoice with the tax office.

Article 14.Applicable to breaches regarding use of invoices

1. A fine of from 100,000 dong to 300,000 dong shall be imposed for preparation of an invoice without clearly completing the criteria on signature or form of payment.

2. A fine of from 2,000,000 dong to 7,000,000 dong shall be imposed for failure to prepare an invoice on the sale of goods or services, except for cases where the law does not require an invoice.

3. Depending on the value recorded on the second duplicate, a fine shall be imposed for preparation of an invoice with differences in duplicates of the one invoice number as follows:

(a)  A fine of from 500,000 dong to 1,000,000 dong applicable to each invoice number where there are differences below 1,000,000 dong.

(b) A fine of from 2,000,000 dong to 3,000,000 dong applicable to each invoice number where there are differences from 1,000,000 dong to below 5,000,000.

(c) A fine of from 4,000,000 dong to 5,000,000 dong applicable to each invoice number where there are differences from 5,000,000 dong to below 10,000,000.

(d) A fine of from 6,000,000 dong to 10,000,000 dong applicable to each invoice number where there are differences from 10,000,000 dong or more.

4. Depending on the value recorded on the second duplicate of the one invoice number, a fine shall be imposed for use of fraudulent invoices as follows:

(a) A fine of from 1,000,000 dong to 2,000,000 dong applicable to each invoice number where the value is below 2,000,000 dong.

(b) A fine of from 3,000,000 dong to 5,000,000 dong applicable to each invoice number where the value is from 2,000,000 dong to below 5,000,000 dong.

(c) A fine of from 6,000,000 dong to 20,000,000 dong applicable to each invoice number where the value is 5,000,000 dong or more.

5. A fine of from 1,000,000 dong to 2,000,000 applicable to each invoice number shall be imposed for use of an invoice whose use validity has expired.

6. A fine of from 2,000,000 dong to 6,000,000 applicable to each invoice number shall be imposed for erasing or altering the contents of criteria on a used invoice.

7. A fine of from 3,000,000 dong to 10,000,000 applicable to each invoice number shall be imposed for using a false invoice.

8. A maximum fine of 100,000,000 dong shall be applied for the breaches stipulated in clauses 3, 4, 5, 6 and 7 of this article.

Article 15.Applicable to breaches regarding administration of invoices

1. A fine of from 100,000 dong to 500,000 dong shall be imposed on an organization or individual late in reporting the use, payment or use finalization of an invoice; or who archives or preserves an invoice incorrectly in terms of the regulations.

2. A fine of from 1,000,000 dong to 2,000,000 dong shall be imposed on an organization or individual who fails to report the use, payment or use finalization of an invoice.

3. A fine of from 1,000,000 dong to 2,000,000 dong shall be imposed for accepting or purchasing an invoice incorrectly in terms of the regulations, applicable to each invoice number used. The maximum level of fine shall be 50,000,000 dong.

Article 16.Applicable to losing, giving away or selling invoices

1. A fine of 500,000 shall be imposed for losing the second duplicate of any one unused invoice number.

2. A fine of 200,000 shall be imposed for losing other duplicates and the second duplicate of any one used invoice number.

3. Applicable to giving away or selling invoices:

(a) In a case of giving away or selling an invoice discovered to have been used, the organization or individual giving or selling it shall be fined at the level stipulated in clauses 4 and 8 of article 14 of this Decree.

(b) In a case of giving away or selling an unused invoice then the organization or individual giving or selling it shall be fined at the level stipulated in clauses 1 and 2 of this article.

4. A maximum fine of 50,000,000 dong shall be applied for the breaches stipulated in clauses 1, 2 and 3 (b) of this article.

Article 17.Measures to redress tax consequences

Any organization or individual guilty of a breach stipulated in articles 14, 15 or 16 of this Decree which results in tax evasion shall:

1. Be obliged to repay the amount of tax evaded.

2. Be subject to a tax fine pursuant to the laws on tax, or in the case of a serious offence be subject to criminal prosecution in accordance with law.

Article 18.Other redressing measures

1. Where an organization or individual is guilty of a breach stipulated in clauses 3 to 7 inclusive of article 14 or in clause 3 of article 15 of this Decree, the invoices concerned may not be declared for deduction or refund of VAT and may not be included in expenses when calculating tax. In cases where payment has already been made, then the total sum paid or deducted or refunded or included in expenses for tax calculation must be paid back; and in respect of entities enjoying State budget funds, they may not conduct accounting finalization of budget disbursements; and in respect of investors they may not conduct accounting finalization of the value of completed capital construction works.

2. Organizations and individuals shall have their use of invoices temporarily suspended when:

(a) They purchase or sell invoices incorrectly in terms of the provisions of this Decree.

(b) They fail to implement decisions imposing a fine for an administrative offence regarding invoices and tax as stipulated in this Decree.

(c) The maximum duration of temporary suspension of use of invoices shall be 3 months as from the date of discovery of a breach in sub-clause (a) above and as from the date an organization or individual fails to correctly implement a decision imposing a fine in sub-clause (b) above. If an offence is redressed earlier than 3 months, then the effectiveness of the temporary suspension of use of invoices shall end immediately after the day on which redress is completed.

If at the expiry of three months the breaches set out in sub-clauses (a) or (b) have still not been redressed, the measures stipulated in clause 3 of this article shall apply.

3. In necessary cases, the tax office may recommend that the competent State office revoke a business registration certificate.

4. The tax office shall have the right to revoke the following: invoices whose use has expired; change of sample form invoices; invoices which have been re-found after a notice of loss was provided; invoices printed with overlapping symbols or numbers; torn invoices; invoices not correctly used in terms of the regulations; and [the tax office shall have the right] to recall the amount collected from the sale of invoices contrary to the provisions of this Decree.

Article 19.Principles and procedures for dealing with breaches; extenuating and aggravating circumstances; enforcement of, and limitation period for enforcing penalty decisions

Principles for dealing with breaches; procedures for imposing fines; extenuating and aggravating circumstances; and the limitation period for enforcing fines imposed for administrative offences regarding invoices as stipulated in this Decree shall be implemented in accordance with the Ordinance on Dealing with Administrative Offences.

Any organization or individual which is fined for an offence in printing, issuing, using or administering an invoice must comply with the decision within a time-limit of ten (10) days as from the date the competent agency issues the decision on the administrative offence. If it deliberately fails to comply with such decision, it shall be compelled to do so in accordance with law.

Article 20.Authority to deal with breaches

The tax office and the specialized financial Inspectorate shall have authority to deal with administrative offences in printing, issuing, using and administering invoices; and authority to deal with administrative offences in printing, issuing, using and administering invoices shall be exercised in accordance with the provisions in articles 36 and 38 of the Ordinance on Dealing with Administrative Offences.

Article 21.Ascertaining authority to deal with administrative offences in the sector of printing, issuing, using and administering invoices

1. The principles for ascertaining authority to deal with administrative offences in printing, issuing, using and administering invoices stipulated in this Decree shall be implemented in accordance with the provisions in article 42 of the Ordinance on Dealing with Administrative Offences.

2. If in the course of its checks and inspections the specialized financial Inspectorate discovers that an organization or individual has committed an offence in printing, issuing, using or administering an invoice which resulted in fraudulent tax declaration or tax evasion, such Inspectorate shall transfer the file to the tax office to deal with it as an administrative offence of fraudulent tax declaration or tax evasion.

3. With respect to any offence in printing, issuing, using or administering an invoice which resulted in fraudulent tax declaration or tax evasion and which the law provides must be prosecuted under the criminal law, the inspecting office or specialized Inspectorate shall prepare a file and transfer it to the competent agency for prosecuting criminal offences.

4. Any agency conducting a criminal prosecution shall notify the results of dealing with any offence in printing, issuing, using or administering an invoice to the agency which proposed that there was criminal liability.

Chapter IV

REWARDS, COMPLAINTS AND DENUNCIATIONS

Article 22.Provision on complaints and denunciations

Complaints, resolution of complaints, and denunciations of offences regarding invoices stipulated in this Decree shall be implemented in accordance with the laws on complaints and denunciations.

Article 23.Provision on rewards

Any organization or individual with work in the discovery, informing, inspecting or dealing with offences in printing, issuing, using or administering invoices shall be rewarded in accordance with the regulations of the Government.

Chapter V

IMPLEMENTING PROVISIONS

Article 24.This Decree shall be of full force and effect fifteen (15) days after the date of its signing.

Articles 13.2, 14, 15.3 and 16 of this Decree shall replace the provisions on administrative offences regarding invoices in sub-clauses (b), (c), (d) and (dd) of article 6.1 of, and article 9.3 (a) of Decree No. 49-1999-ND-CP of the Government dated 8 July 1999 on dealing with administrative offences in the accounting sector.

Article 25.The Minister of Finance shall provide guidelines for the implementation of this Decree and shall co-ordinate with State offices, political organizations, socio-political organizations, social organizations and socio-occupational organizations to provide information on this Decree and to motivate the citizens to implement and to supervise its implementation.

Article 26.Ministers, heads of ministerial equivalent bodies, heads of Government bodies and chairmen of people s committees of provinces and cities under central authority shall be responsible for the implementation of this Decree.