Law amending Law on Tax Administration, Law No. 21/2012/QH13

THE PRESIDENT

Order No. 23/2012/L-CTN of December 3, 2012, on the promulgation of law

THE PRESIDENT OF THE SOCIALIST REPUBLIC OF VIETNAM

Pursuant to Article 103 and Article 106 of the 1992 Constitution of the Socialist Republic of Vietnam, which was amended and supplemented under Resolution No. 51/2001/QH10 of December 25, 2001, of the Xth National Assembly, the 10th session;

Pursuant to Article 91 of the Law on Organization of the National Assembly;

Pursuant to Article 57 of the Law on Promulgation of Legal Documents,

PROMULGATES:

The Law Amending and Supplementing a Number of Articles of the Law on Tax Administration,

which was passed on November 20, 2012, by the XIIIth National Assembly of the Socialist Republic of Vietnam at its 4th session.

President of the Socialist Republic of Vietnam
TRUONG TAN SANG

Law Amending and Supplementing a Number of Articles of the Law on Tax Administration

(No. 21/2012/QH13)

Pursuant to the 1992 Constitution of the Socialist Republic of Vietnam, which was amended and supplemented under Resolution No. 51/2001/QH10;

The National Assembly promulgates the Law Amending and Supplementing a Number of Articles of Law No. 78/2006/QH11 on Tax Administration.

Article 1.

To amend and supplement a number of articles of the Law on Tax Administration:

1. To add the following Clauses 4, 5 and 6 to Article 4:

“4. Application of the risk management mechanism in tax administration:

a/ The application of the risk management mechanism in tax administration covers: collection of information and data relating to taxpayers; elaboration of sets of tax administration criteria; assessment of taxpayers’ law observance; and proposal and application of tax administration methods;

b/ Tax administration agencies shall manage and use professional information systems to assess tax-related risks and taxpayers’ law observance, select entities subject to tax examination or inspection and support other professional operations in tax administration.

5. When carrying out tax-related procedures for imported and exported goods, priority methods will be applied if taxpayers fully meet the following criteria:

a/ Having committed no violation of tax and customs laws within two consecutive years;

b/ Making via-bank payment in accordance with law;

c/ Carrying out e-customs and e-tax procedures;

d/ Observing accounting and statistics laws;

e/ Reaching the required level of annual import or export turnover.

6. The Government shall detail Clauses 4 and 5 of this Article.”

2. To add the following Clauses 10, 11 and 12 to Article 5:

“10. Risk management in tax administration means the systematic application of legal provisions and professional processes to identify, assess and classify risks which might adversely affect the effectiveness and effect of tax administration, serving as a basis for tax administration agencies to reasonably allocate their resources and effectively apply management methods.

11. Prior agreement on methods of determining taxable prices means a written agreement between the tax agency and a taxpayer or between the tax agency and the taxpayer and tax authorities of a country or territory with which Vietnam has signed an agreement on double taxation avoidance and tax evasion prevention with regard to income tax for a certain period of time, which specifically indicates the tax bases and methods of determining taxable prices, or taxable prices according to market prices. Prior agreements on methods of determining taxable prices must be made before taxpayers submit their tax declaration dossiers.

12. Prior determination of codes and customs value and prior certification of the origin of imported or exported goods means the issuance by customs offices of documents determining codes and customs value and certifying the origin of imported or exported goods before carrying out customs procedures.”

3. To amend and supplement Clauses 1 and 2, Article 6 as follows:

“1. To receive support and guidance in tax payment; to be provided with information and documents for performing tax-related obligations and enjoying tax-related benefits.

2. To request tax administration agencies to explain their tax calculation or assessment; to request customs offices to determine codes and customs value and certify the origin of imported or exported goods before carrying out customs procedures according to the Government’s regulations; to request agencies or organizations to appraise the quantity, quality and categories of imported or exported goods.”

4. To add the following Clause 10 to Article 7:

“10. Taxpayers being business organizations operating in geographical areas with information technology infrastructure shall make tax declaration, payment and transactions with tax administration agencies through electronic devices in accordance with the law on e-transactions.

The Government shall detail this Clause.”

5. To amend and supplement Clauses 2 and 3, Article 8 as follows:

“2. To disseminate, popularize and guide tax laws; to publicize tax-related procedures at the head offices and on the websites of tax administration agencies and in the mass media.

3. Tax administration agencies shall explain and provide information relating to the determination of tax liabilities to taxpayers; tax agencies shall publicize payable tax amounts of business households or individuals in their communes, wards or townships; customs offices shall determine the codes and customs value and certify the origin of imported and exported goods before carrying out customs procedures according to the Government’s regulations.”

6. To add the following Clause 9 to Article 9:

“9. Tax agencies shall apply the mechanism of prior agreement on the method of determining taxable prices with taxpayers and tax authorities of countries or territories with which Vietnam has signed agreements on double taxation avoidance and tax fraud and evasion prevention with regard to income tax.”

7. To add the following Clause 3 to Article 30:

“3. The mechanism of prior agreement on the method of determining taxable prices shall be applied at the request of taxpayers and on the basis of the agreements between tax agencies and taxpayers according to unilateral, bilateral or multilateral agreements between  tax agencies, taxpayers and tax authorities of related countries or territories.

The Government shall detail this Clause.”

8. To add the following Clause 1a below Clause 1, Article 31; to amend and supplement Clause 6, Article 31 as follows:

“1a. For taxes declared and paid on a quarterly basis, a tax declaration dossier comprises:

a/ The quarterly tax declaration;

b/ A list of invoices of goods and services sold (if any);

c/ A list of invoices of goods and services purchased (if any);

d/ Other documents related to the payable tax amount.”

“6. The Government shall provide taxes subject to monthly, quarterly or annual declaration, quarterly declaration for temporary calculation, declaration upon each time of arising of a tax liability, and declaration for tax finalization; criteria for identification of taxpayers to make quarterly tax declaration and tax declaration dossier for each specific case.”

9. To amend and supplement Clauses 1, 2, 3 and 6, Article 32 as follows:

“1. For taxes which are declared on a monthly or quarterly basis:

a/ No later than the 20th day of the month following the month in which a tax liability arises, for taxes declared and paid on a monthly basis;

b/ No later than the 30th day of the quarter following the quarter in which a tax liability arises, for taxes declared and paid on a quarterly basis.

2. For taxes with annual tax periods:

a/ No later than the 30th day of the first month of a calendar year or fiscal year, for annual tax declaration dossiers.

For non-agricultural land use tax and land rents, the tax declaration deadlines comply with the laws on non-agricultural land use tax and land rents;

b/ No later than the 30th day of the quarter following the quarter in which a tax liability arises, for dossiers of quarterly tax declaration for temporary calculation;

c/ No later than the 90th day from the end of a calendar year or fiscal year, for annual tax finalization dossiers.

3. No later than the 10th day from the date on which a tax liability arises, for taxes declared and paid upon each time of arising of a tax liability.

For incomes from land and registration fee, the deadlines for submission of tax declaration dossiers comply with the Government’s regulations and relevant laws.”

“6. Places for submission of tax declaration dossiers are provided as follows:

a/ Taxpayers shall submit tax declaration dossiers to their managing tax agencies;

b/ For cases in which tax declaration dossiers are submitted according to the one-stop shop mechanism, the places for dossier submission are provided by such mechanism;

c/ The places for submission of tax declaration dossiers for imported and exported goods comply with the Customs Law;

d/ The Government shall provide places for submission of tax declaration dossiers for taxpayers engaged in different production and business activities; taxpayers conducting production and business activities in different geographical areas; taxpayers having tax liabilities subject to declaration and payment of tax upon each time of arising of a tax liability; taxpayers having to pay taxes on land-related incomes; taxpayers making tax declarations through e-transactions, and in other necessary cases.”

10. To amend and supplement Clauses 2 and 4, Article 33 as follows:

“2. The prolongation does not exceed thirty days, for cases of submitting dossiers of monthly, quarterly or annual tax declaration, temporarily calculated tax declaration or tax declaration upon each time of arising of a tax liability; or sixty days for cases of submitting dossiers of declaration for tax finalization, from the deadline for submission of tax declaration dossiers.”

“4. Within three working days after receiving a written request for prolongation of the deadline for submission of tax declaration dossiers, tax agencies shall issue a written reply the taxpayer, clearly stating its acceptance or refusal of the request.”

11. To amend and supplement Article 42 as follows:

“Article 42. Tax payment deadlines

1. In case taxpayers calculate tax by themselves, the tax payment deadline is the last day of the time limit for submission of tax declaration dossiers.

2. In case tax agencies calculate or assess tax, the tax payment deadline is stated in tax agencies’ notices.

For incomes from land and registration fee, the payment deadlines comply with the Government’s regulations and relevant laws.

3. The time limits for tax payment for imported and exported goods are prescribed as follows:

a/ For raw materials and supplies imported for export production, the time limit for tax payment is two hundred and seventy five days from the date of registration of the customs declaration, provided that enterprises fully satisfy the following conditions:

- Having an export production establishment in the Vietnamese territory;

- Having conducted import and export activities for at least two consecutive years by the date of registration of the customs declaration without committing any acts of tax fraud or evasion and owing any overdue tax debts, late-payment interests or fines;

- Observing the accounting and statistics laws;

- Making via-bank payment in accordance with law.

In case the above-mentioned conditions are not fully met but the payable tax amount is guaranteed by a credit institution, the tax payment time limit is the guarantee period which, however, must not exceed two hundred and seventy five days from the date of registration of the customs declaration and the taxpayer is not required to pay late-payment interests during the guarantee period.

Taxpayers that neither meet the above-mentioned conditions nor obtain guarantee from a credit institution shall pay tax before customs clearance or goods release;

b/ For goods temporarily imported for re-export, taxes must be paid before the customs procedures for temporary import of goods are completed.

In case the payable tax amount is guaranteed by a credit institution, the tax payment time limit is the guarantee period, which, however, must not exceed fifteen days from the deadline for temporary import for re-export and the taxpayer is not required to pay late-payment interests during the guarantee period.

c/ For goods other than those mentioned at Point a or b of this Clause, taxes must be paid before customs clearance or goods release.

In case the payable tax amount is guaranteed by a credit institutions, the taxpayer may enjoy customs clearance or goods release but shall pay late-payment interests from the date of customs clearance or goods release to the date of tax payment in accordance with Article 106 of this Law. The maximum guarantee period is thirty days from the date of registration of the customs declaration;

d/ Past the guarantee period, if taxpayers fail to pay tax and late-payment interests (if any), guaranteeing credit institutions shall fully pay tax and late-payment interests on behalf of taxpayers.”

12. To amend and supplement Article 45 as follows:

“Article 45. Order of paying taxes, late-payment interests and fines

In case a taxpayer concurrently has tax debts, tax amounts subject to retrospective collection, newly arisen tax amounts, late-payment interests and fines, these amounts must be paid in the following order:

1. For taxes managed by tax agencies:

a/ Tax debs;

b/ Tax amounts subject to retrospective collection;

c/ Late-payment interests;

d/ Newly arisen tax amounts;

e/ Fines.

2. For taxes managed by customs offices:

a/  Overdue tax debts subject to coercive collection;

b/ Late-payment interests subject to coercive collection;

c/ Overdue tax debts not yet subject to coercive collection;

d/ Late-payment interests not yet subject to coercive collection;

e/ Newly arisen tax amounts;

f/ Fines.”

13. To amend and supplement Article 47 as follows:

“Article 47. Handling of overpaid tax, late-payment interest and fine amounts

1. A taxpayer that has paid a tax, late-payment interest or fine amount larger than the payable tax, late-payment interest or fine amount of a certain tax arising within ten years from the date of payment into the state budget may have the overpaid amount cleared against its/his/her owed tax debts, late-payment interests and fines, including clearance among different taxes, cleared against the payable tax, late-payment interest or fine amount of the subsequent tax payment period, or refunded in case the taxpayer owes no tax debts, late-payment interests or fines.

2. When a taxpayer requests refund of an overpaid tax, late-payment interest or fine amount, a tax administration agency shall issue a decision on refund of the overpaid amount or a written reply clearly stating the reason for its refusal to refund the overpaid amount within five working days after receiving such request.”

14. To amend and supplement Clause 1, Article 49 as follows:

“1. Prolongation of tax payment time limits shall be considered upon request of taxpayers that fall into one of the following cases:

a/ Suffering material damage due to a natural disaster, a fire or an unexpected accident which directly affects their production and business activities;

b/ Having to suspend operation due to relocation of production or business establishments at the request of competent state agencies, which affects their production and business results;

c/ Having not yet received capital construction investment funds written in the state budget estimate;

d/ Being unable to pay taxes on time due to other exceptional difficulties stipulated by the Government.”

15. To amend and supplement Article 50 as follows:

“Article 50. Competence to prolong tax payment time limits

1. The Government may prolong tax payment time limits in case such prolongation does not lead to adjustment of the state budget revenue estimate already decided by the National Assembly.

2. Heads of tax administration agencies that directly manage taxpayers may, on the basis of dossiers for tax payment time limit prolongation, decide on tax amounts for which the payment time limits are prolonged and the prolongation duration.”

16. To amend and supplement Clause 1, Article 54 as follows:

“1. Dissolved enterprises shall fulfill their tax payment obligations in accordance with the laws on enterprises, credit institutions and insurance business and other relevant laws.”

17. To amend and supplement Article 58 as follows:

“Article 58. Tax refund dossiers

1. A tax refund dossier comprises:

a/ A written claim for tax refund;

b/ Documents related to the tax refund claim;

2. A tax refund dossier must be made in one set and submitted to the tax administration agency directly managing the taxpayer or the customs office competent to decide on tax refund.”

18. To amend and supplement Article 60 as follows:

“Article 60. Responsibilities of tax administration agencies for processing tax refund dossiers

1. Tax refund dossiers shall be classified as follows:

a/ Dossiers eligible for tax refund before examination are those of taxpayers that have properly observed tax laws and have made via-bank payments for their transactions in accordance with law.

b/ Cases subject to examination before tax refund:

- Tax refund under treaties to which the Socialist Republic of Vietnam is a contracting party;

- Taxpayers request tax refund for the first time, except personal income tax;

- Taxpayers request tax refund within two years from the time of being handled for acts of tax evasion or fraud;

- Payments for goods or services are not made via banks as prescribed by law;

- Enterprises undergo merger, consolidation, division, split-up, dissolution, bankruptcy, ownership transformation or operation termination; state enterprises are assigned, sold, contracted or leased;

- Past the time limit already notified in writing by tax administration agencies, taxpayers still fail to explain or supplement their tax refund dossiers or their explanations or supplementations fail to prove the accuracy of their declared tax amounts;

- The imported goods are subject to inspection before tax refund according to the Government’s regulations.

2. For a dossier eligible for tax refund before examination, the tax administration agency shall, within six working days after receiving a complete tax refund dossier, decide on tax refund at the taxpayer’s request; in case the dossier is ineligible for tax refund before examination, it shall notify in writing the taxpayer that the examination will be conducted before tax refund or notify the reason for not refunding tax.

3. The time limits for examination after tax refund for dossiers eligible for tax refund before examination are provided as follows:

a/ Examination must be carried out within one year from the date of issuance of the tax refund decision in the following cases:

- The business establishment declares losses in two consecutive years or suffers a loss exceeding its equity capital;

- The business establishment is refunded with taxes on real estate, trade or service provision;

- The business establishment has relocated its head office twice or more within twelve months by the date of issuance of the tax refund decision;

- The business establishment sees abnormal changes in the taxable turnover and refunded tax amount within twelve months by the date of issuance of the tax refund decision;

b/ For cases other than those specified at Point a of this Clause, examination after tax refund must be carried out within ten years after the date of issuance of a tax refund decision according to the principle of risk management.

4. For dossiers subject to examination before tax refund, within forty days after receiving a complete tax refund dossier, the tax administration agency shall issue a tax refund decision or a written reply clearly stating the reason for not refunding tax.

5. Past the time limits specified in Clauses 2 and 4 of this Article, if tax administration agencies are at fault for the late issuance of tax refund decisions, in addition to the refunded tax amounts, they shall also pay interests according to the Government’s regulations.”

19. To amend and supplement Clause 2, Article 64 as follows:

“2. When necessary to conduct physical inspection to obtain sufficient grounds for processing tax exemption or reduction dossiers, within sixty days after receiving a complete dossier, tax administration agencies shall issue tax a tax exemption or reduction decision or a written notice clearly stating the reason for ineligibility for tax exemption or reduction.”

20. To add the following Clause 3 to Article 65:

“3. Tax debts, late-payment interests and fines of taxpayers other than those specified in Clauses 1 and 2 of this Article for which tax administration agencies have applied all measures of enforcing tax administrative decisions specified in Clause 1, Article 93 of this Law, and irretrievable tax debts, late-payment interests and fines which have become overdue for more than ten years from the tax payment deadlines.”

21. To amend Clause 2, Article 66 as follows:

“2. Bankruptcy declaration decision, for enterprises declared bankrupt;”

22. To amend and supplement Article 67 as follows:

“Article 67. Competence to remit owed tax, late-payment interest and fine amounts

1. For taxpayers being enterprises declared bankrupt specified in Clause 1, Article 65, persons specified in Clauses 2 and 3, Article 65, and households specified in Clause 3, Article 65, of this Law, provincial-level People’s Committee chairpersons may remit their owed tax, late-payment interest and fine amounts.

2. For taxpayers other than those specified in Clause 1 of this Article, the competence to remit their debts is provided as follows:

a/ The Prime Minister may remit debts for taxpayers owing tax, late-payment interest or fine amounts of VND 10 billion or more;

b/ The Minister of Finance may remit debts for taxpayers owing tax, late-payment interest or fine amounts of between VND 5 billion and under VND 10 billion;

c/ The General Director of Taxation or the General Director of Customs may remit debts for taxpayers owning tax, late-payment interest or fine amounts of under VND 5 billion.

3. The Government shall report to the National Assembly on annually remitted tax debts, late-payment interests and fines when submitting state budget finalizations to the National Assembly for approval.

4. The Government shall stipulate the remittance of debts.”

23. To amend and supplement Clause 2, Article 70 as follows:

“2. Tax administration agencies shall apply necessary professional measures to collect, exchange and process information at home and abroad and official information from foreign tax administration authorities and competent authorities under treaties to which the Socialist Republic of Vietnam is a contracting party and documents in the taxation and customs sectors signed between Vietnam and related countries for use in tax administration.”

24. To amend Article 78 as follows:

“Article 78. Tax examination at head offices of taxpayers

1. Cases of tax examination at head offices of taxpayers:

a/ Cases specified at Points c and d, Clause 3, Article 77 of this Law;

b/ Cases of post-customs clearance examination, including planned examination and sample examination to assess the observance of tax laws and inspection of imported and exported goods showing signs of tax law violation after customs clearance.

If signs of tax evasion or fraud are detected through post-customs clearance examination, the director of the Department for Post-Customs Clearance Examination, directors of provincial-level Customs Departments or heads of Sub-Departments for Post-Customs Clearance Examination may decide to apply the measures specified in Section 4, Chapter X of this Law;

c/ Cases in which to-be-examined entities are identified based on tax-related risk assessment criteria through analysis and assessment of taxpayers’ law observance, cases showing signs of law violation and cases selected under examination plans or issues as decided by heads of superior-level tax administration agencies. For the cases specified at this Point, tax administration agencies shall carry out examinations at head offices of taxpayers no more than once a year.

2. The tax examination decision must be sent to the taxpayer concerned within three working days after the date of its signing. Within five working days after receiving the tax examination decision, if the taxpayer is able to prove that the declared tax amount is correct or that it/he/she has fully paid the payable tax amount, the tax administration agency shall cancel the tax examination decision.

3. The order and procedures for tax examination are specified as follows:

a/ Announcing the tax examination decision at the beginning of the tax examination;

b/ Comparing the declared contents with accounting books and documents, financial statements, relevant documents, and the actual situation within the scope and contents of the tax examination decision;

c/ The tax examination must last no longer than five working days from the date of announcing the examination decision. In case of planned examination of imported or exported goods, this time limit is fifteen days;

d/ When necessary, the tax examination decision may be extended once but the extension must not exceed the time limit specified at Point c of this Clause;

e/ Making a written record of tax examination within five working days from the end of the examination duration;

f/ Handling the examination result according to competence or transferring it to competent authorities for handling.”

25. To add the following Clause 4 to Article 92:

“4. To refrain from applying tax enforcement measures when taxpayers are permitted by tax administration agencies to pay their tax debts in installments within twelve months from the date of commencement of the tax enforcement period. The installment payment of tax debts shall be considered at taxpayers’ request and must be guaranteed by a credit institution. Taxpayers shall pay late-payment interests at the daily rate of 0.05% of the late paid tax amount.

The Government shall detail this Clause.”

26. To amend and supplement Clause 1, Article 93 and add the following Clause 3 to Article 93:

“1. Measures of enforcing tax-related administrative decisions include:

a/ Deducting money from the accounts of entities subject to enforcement of tax-related administrative decisions at state treasuries, commercial banks or other credit institutions; requesting freezing of these accounts;

b/ Deducting part of salaries or incomes;

c/ Suspending customs procedures for imported or exported goods;

d/ Announcing invoices to be invalid;

e/ Distraining assets and auctioning distrained assets in accordance with law; 

f/ Confiscating money or other assets of entities subject to enforcement of tax-related administrative decisions, which are currently  held by other organizations or individuals;

g/ Revoking business registration certificates, enterprise registration certificates, establishment and operation licenses or practice licenses.”

“3. The application of the enforcement measures specified in Clause 1 of this Article complies with Articles 97, 98, 98a, 99, 100, 101 and 102 of this Law and other relevant legal documents. In case the taxpayer absconds or disperses its/his/her assets, the person competent to issue enforcement decisions specified in Article 94 of this Law shall decide to apply appropriate enforcement measures so as to assure prompt recovery of tax debts for the state budget.”

27. To add the following Article 98a below Article 98:

“Article 98a. Enforcement by the measure of announcing invoices to be invalid

1. The measure of announcing invoices to be invalid is applied when tax administration agencies cannot apply the enforcement measures specified at Points a, b and c, Clause 1, Article 93 of this Law or cannot fully collect tax debts, late-payment interests or fines though having applied these measures.

2. Heads of tax administration agencies shall notify entities subject to tax enforcement within three working days before announcing invoices to be invalid.

3. When applying the enforcement measure specified in this Article, tax administration agencies shall publicly announce it in the mass media.”

28. To amend and supplement Clause 1, Article 99 as follows:

“1. The measure of distraining assets and auctioning distrained assets is applied when tax administration agencies cannot apply the enforcement measures specified at Points a, b, c and d, Clause 1, Article 93 of this Law or cannot fully collect tax debts, late-payment interests or fines though having applied these measures.

The measure of distraining assets is not applied to individual taxpayers who are receiving medical treatment at medical examination and treatment establishments founded under Vietnam’s law.”

29. To amend and supplement Point a, Clause 1 of Article 100 and add the following Clause 4 to Article 100:

“a/ Tax administration agencies cannot apply the enforcement measures specified at Points a, b, c, d and e, Clause 1, Article 93 of this Law or cannot fully collect tax debts, late-payment interests or fines though having applied these measures;”

“4. The Government shall provide the order and procedures for enforcing tax-related administrative decisions by the measure of confiscating money or other assets of entities subject to the enforcement measure which are currently held by other organizations or individuals.”

30. To modify the title of Article 101; amend Clause 1 of Article 101 and add the following Clause 3 to Article 101:

“Article 101. Enforcement by the measure of suspending customs procedures for imported or exported goods

1. The measure of suspending customs procedures for imported or exported goods is applied when customs offices cannot apply the measures specified at Points a and b, Clause 1, Article 93 of this Law or cannot fully collect tax debts, late-payment interests or fines though having applied these measures.”

“3. The measure of suspending customs procedures for imported or exported goods must not be applied to:

a/ Exported goods not liable to export duty;

b/ Imported and exported goods directly serving security, defense, prevention and control of natural disasters, epidemics or urgent relief; humanitarian aid and non-refundable aid.”

31. To amend and supplement Article 102 as follows:

“Article 102. Enforcement by the measure of revoking business registration certificates, enterprise registration certificates, establishment and operation licenses or practice licenses

1. The measure of revoking business registration certificates, enterprise registration certificates, establishment and operation licenses or practice licenses is applied when tax administration agencies cannot apply the measures specified at Points a, b, c, d, e and f, Clause 1, Article 93 of this Law or cannot fully collect tax debts, late-payment interests or fines though having applied these measures.

2. Heads of tax administration agencies shall send written requests for revocation of business registration certificates, enterprise registration certificates, establishment and operation licenses or practice licenses to competent state management agencies.

3. When applying the enforcement measure specified in this Article, competent state management agencies shall publicly announce it in the mass media.”

32. To amend and supplement Article 106 as follows:

“Article 106. Handling of late tax payment

1. A taxpayer that pays tax after the prescribed time limit or extended time limit for tax payment, the time limit stated in the notice or handling decision of a tax administration agency shall fully pay the tax and late-payment interest amount at the progressive rate 0.05% of the late paid tax amount per each day of the late payment period not exceeding ninety days, or 0.07% of the late paid tax amount per day of late payment after ninety days.

2. A taxpayer that makes incorrect declaration, leading to an insufficient payable tax amount but later voluntarily remedies the consequence by fully paying the payable tax amount before a competent agency detects its/his/her violation shall pay a tax late-payment interest but not be sanctioned for violations of tax administrative procedures or insufficient tax payment or tax evasion.

For imported or exported goods, if a taxpayer makes additional declaration within sixty days from the date of registration of the customs declaration under Point b, Clause 2, Article 34 of this Law and actively pays the deficit tax amount into the state budget, it/he/she shall pay a late-payment interest calculated based on the deficit tax amount under this Article but not be sanctioned for violations of tax administrative procedures, insufficient tax payment or tax evasion.

3. Taxpayers shall determine late-payment interests based on the late paid tax amount, the number of days of late payment and the rate specified in Clause 1 of this Article.

If taxpayers cannot determine or incorrectly determine late-payment interests, tax administration agencies shall determine and notify such amounts to taxpayers.

4. Past thirty days from the tax payment deadline, if taxpayers fail to pay tax and late-payment interests, tax administration agencies shall notify those taxpayers of tax debts and late-payment interests.

5. In case agencies or organizations authorized by tax administration agencies to collect tax delay the transfer of the tax, late-payment interest and fine amounts collected from taxpayers into the state budget, they shall pay late-payment interests calculated on late transferred amounts at the rate specified in Clause 1 of this Article.”

33. To amend and supplement Article 107 as follows:

“Article 107. Sanctioning of acts of making incorrect declarations leading to decreases in payable tax amounts or increases in refundable tax amounts

1. A taxpayer that has fully and truthfully reflected economic operations liable to tax in accounting books, invoices and documents but made incorrect declarations, leading to a decrease in the payable tax amount or an increase in the refundable tax amount shall fully pay the inadequately declared tax amount, return the excessively refunded tax amount and pay a fine equal to 20% of the inadequately declared or excessively refunded tax amount and a late-payment interest calculated based on the inadequately declared or excessively refunded tax amount.

2. For imported and exported goods, if taxpayers make incorrect declarations, leading to a decrease in the payable tax amount or an increase in the exemptible, reducible or refundable tax amount but do not fall into the cases specified in Clauses 6 and 7, Article 108 of this Law, in addition to having to fully pay tax and late-payment interests, taxpayers shall also pay:

a/ A fine equal to 10% of the inadequately declared tax amount or excessively exempled, reduced or refunded tax amount, if they detect their incorrect declarations and make additional declarations after sixty days from the date of declaration registration but before customs offices conduct tax examination and inspection at the taxpayers’ head offices under Clause 2, Article 34 of this Law;

b/ A fine equal to 20% of the inadequately declared or excessively exempted, reduced or refunded tax amount, for cases other than those specified at Point a of this Clause.”

34. To amend and supplement Clauses 6 and 9, Article 108 as follows:

“6. Making declarations inconsistent with the actual exported or imported goods without making additional declarations in the tax declaration dossier after the goods are cleared from customs procedures;

9. Using duty-free goods or goods eligible for tax exemption or tax exemption consideration for improper purposes without declaring the change of the use purpose to tax administration agencies.”

35. To amend and supplement Article 110 as follows:

“Article 110. Statute of limitations for sanctioning tax law violations

1. For an act of violation of tax procedures, the statute of limitations is two years from the date such act is committed.

2. For an act of tax evasion or tax fraud which is not severe enough for penal liability examination, or an act of incorrect declaration to reduce payable tax amounts or increase refundable tax amounts, the statute of limitations is five years from the date such act is committed.

3. After the statute of limitations for sanctioning tax law violations, taxpayers will not be sanctioned but shall fully pay into the state budget the underpaid, evaded or defrauded tax amounts and late-payment interests that arose within ten years before  the date such violations are detected. Taxpayers that do not make tax registration shall fully pay underpaid, evaded or defrauded tax amounts and late-payment interests that have arisen before such violations are detected.”

36. To add the phrase “late-payment interests” before the word “fines” in the title of Section 2, Chapter VIII, and in Articles 3, 5, 8, 65, 66, 68, 90, 92, 93, 98, 99, 100, 113, 114 and 118; to add the phrase “and not have to pay money” after the phrase “not be fined” in Clause 4, Article 49; to replace the phrase “late-payment fines” in Clause 3, Article 56 of this Law with the phrase “late-payment interests”.

37. To add the phrase “or enterprise registration certificate” after the phrase “business registration certificate” in Articles 20, 72 and 94 of this Law.

38. To annul Point e, Clause 3, Article 77 of this Law.

Article 2.

1. This Law takes effect on July 1, 2013.

2. For contents on tax inspection provided in Tax Administration Law No. 78/2006/QH11 which are different from the provisions of the Inspection Law, the provisions of the Inspection shall apply.

3. The Government shall remit irretrievable tax debts and fines which arose before July 1, 2007, in the cases below and report its results to the National Assembly:

a/ Tax debts and fines of households and individuals that have met with difficulties and cannot pay tax debts and have stopped business operation;

b/ Tax debts and fines of state enterprises for which dissolution decisions have been issued by competent agencies; tax debts and fines of state enterprises which have been equitized or undergone ownership transformation and the new legal entities are not responsible for these tax debts.

4. The Government shall detail and guide articles and clauses as assigned in the Law.

This Law was passed on November 20, 2012, by the XIIIth National Assembly of the Socialist Republic of Vietnam at its 4th session.-

Chairman of the National Assembly
NGUYEN SINH HUNG