Official Dispatch 2768/TCT-PC 2021 sanctioning of administrative violations related to taxes and invoices

To: Tax Department of Ha Nam province

The General Department of Taxation receives the Official Dispatch No. 1840/CT-NVDTPC dated June 4, 2021 of Tax Department of Ha Nam province regarding sanctioning of administrative violations related to taxes and invoices. The General Department of Taxation’s opinion on such matter shall be as follows:

1. Regarding the determination of the time of submission of electronic tax declaration dossiers

- Pursuant to Clause 3 Article 5 of the Government's Decree No. 125/2020/ND-CP dated October 19, 2020, on sanctioning of administrative violations related to taxes and invoices:

“3. If an organization or individual commits many administrative violations, it/he/she shall be sanctioned for each violation, except for the following cases:

...

b) In case where a taxpayer is late in submitting multiple tax declaration dossiers for many tax periods of the same tax at the same time, he/she/it shall only be sanctioned for one act of late submission of tax declaration dossiers with the highest fine bracket among the acts that have been carried out according to this Decree and the aggravating circumstances of repeated violations shall be applied.

If one tax declaration dossier among the late submitting tax declaration dossiers falls into the case of tax evasion, it shall be separated to sanction for the act of tax evasion;”

- Pursuant to Article 8 of the Ministry of Finance’s Circular No. 19/2021/TT-BTC dated March 18, 2021 guiding tax-related e-transactions:

Article 8. Determination of time of submission of electronic tax dossiers and time of electronic tax payment by taxpayers and time of sending notices, decisions and documents to taxpayers by tax agencies

1. Time of submission of electronic tax dossiers and time of electronic tax payment

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b) The time for certification of electronic tax filing is determined as follows:

b.1) For an electronic tax registration dossier: is the date on which the tax agency's system receives the dossier as written on the notice of receipt of electronic tax registration dossier sent by the tax agency to the taxpayer (made according to the form No.01-1/TB-TDT issued together with this Circular).

b.2) For an tax declaration dossier (except for tax declaration dossiers in case where the tax administration agency determine tax amounts and notify tax payment under Article 13 of the Decree No. 126/2020/ND-CP): is the date on which the tax agency's system receives the dossier as written on the notice of receipt of electronic tax declaration dossier sent by the tax agency to the taxpayer (made according to the form No.01-1/TB-TDT issued together with this Circular), if the tax declaration dossier is accept by the tax agency in the notice of acceptance of electronic tax declaration dossier sent by the tax agency to the taxpayer (made according to the form No. 01-2/TB-TDT issued together with this Circular)...

b.3) For dossiers other than those specified at Points b.1, b.2 as mentioned above: is the date on which the tax agency's system receives the dossier as written on the notice of acceptance of e-dossier sent by the tax agency to the taxpayer (made according to the form No.01-2/TB-TDT issued together with this Circular).

b.4) The time for certification of electronic tax dossier submission defined in this Clause is the ground for the tax agency to determine the time for submission of tax dossier, or calculate the time to process tax dossier in accordance with the Law on Tax Administration, guiding documents and this Circular.

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2. The time of sending notices, decisions and documents by the tax agencies to taxpayers is determined to be the same day if the dossier is successfully signed and sent between 00:00:00 and 23:59:59 of the day.”

Based on the above regulations, the time of confirming the submission of electronic tax declaration dossier is determined as the date on which the tax agency’s system receives the dossier as written on the notice of receipt of electronic tax declaration dossier sent by the tax agency to the taxpayer. Therefore, the determination of submission of electronic tax declaration dossiers at the same time shall comply with Circular No. 19/2021/TT-BTC.

2. Regarding the act of late submission of tax declaration dossiers

- Pursuant to Point d Clause 5 Article 2 of Circular No. 166/2013/TT-BTC dated November 15, 2013 of the Ministry of Finance, on sanctioning of administrative violations related to taxes:

“If the taxpayer fails to submit declaration dossiers of the same tax of multiple tax periods, the taxpayer shall be sanctioned for failure to follow tax procedures with an aggravating circumstance which is repeated violations. If the tax declaration dossier is not submitted within 90 days from the deadline, the taxpayer shall be sanctioned for tax evasion prescribed in Article 13 of this Circular.”

- Pursuant to Point b Clause 3 Article 5 of the Government's Decree No. 125/2020/ND-CP dated October 19, 2020, on sanctioning of administrative violations related to taxes and invoices.

According to the above regulations, in case where a taxpayer is late in submitting multiple tax declaration dossiers of the same tax at the same time (the acts of violations of procedures for tax) with deadlines of submission before and after December 5, 2020, the tax agency shall apply the principle defined in Clause 3 Article 5 of Decree No. 125/2020/ND-CP to sanction for 01 act of late submission of tax declaration dossier with the highest fine bracket among the acts that have been carried out with the aggravating circumstances of repeated violations (the tax agency shall, based on Decree No. 129/2013/ND-CP and Decree No. 125/2020/ND-CP, determine the fine corresponding to the violation in each period to determine the act on which the highest fine is imposed).

In case where a taxpayer is late in submitting multiple tax declaration dossiers of the same tax at the same time (falling into the case subject to sanctioning of violation on tax evasion) with the deadline for submission before and after December 5, 2020, the tax agency shall sanction on each act of tax evasion according to regulations. The aggravating circumstance of repeated violations shall be applied to the act of tax evasion committed thereafter.

3. Regarding the act of incorrectly declaring, but not leading to a sufficiency in the payable tax amount

According to Point a Clause 3 Article 5 of the Government's Decree No. 125/2020/ND-CP dated October 19, 2020, on sanctioning of administrative violations related to taxes and invoices:

“3. If an organization or individual commits many administrative violations, it/he/she shall be sanctioned for each violation, except for the following cases:

a) In case where a taxpayer incorrectly declares one or more items on the tax dossiers of the same tax at the same time, the act of incorrectly declaring in the case of tax procedure sanction shall be only sanctioned for one act of incorrectly declaring items on the tax dossier which has the highest fine bracket among the acts that have been carried out according to this Decree and the aggravating circumstances of repeated violations shall be applied;

Point a Clause 3 Article 5 of Decree No. 125/2020/ND-CP applies to cases where the taxpayer incorrectly declares one or more items on the tax dossiers of the same tax at the same time. In case where the tax agency detects that the taxpayer incorrectly declares multiple tax declaration dossiers (but not leading to a sufficiency in the payable tax amount) with different times of committing violations, it shall sanction each violation in accordance with law regulations.

4. Regarding the act of failing to make invoices within the prescribed time

a) Regarding sanctioning of the act of failing to make invoices within the prescribed time

- Pursuant to Point d Clause 1 Article 3 of the 2012 Law on Handling of Administrative Violations: “An administrative violation shall be sanctioned only once”

- Pursuant to Clause 2 Article 136 of the 2019 Law on Tax Administration:

“2. An administrative violation of illegally using invoices, using unlawful invoices or using invoices in contravention of regulations leading to tax underpayment or evasion shall not be sanctioned as an invoice-related administrative violation but as a tax administration-related administrative violation.”

- Pursuant to Point d Clause 3 Article 5 of the Government's Decree No. 125/2020/ND-CP dated October 19, 2020:

“d) The acts of violations on using unlawful invoices or unlawfully using invoices that are sanctioned under Articles 16 and 17 of this Decree shall not be sanctioned in accordance with Article 28 of this Decree.”

Based on the above-mentioned regulations, in case a taxpayer commits the violation of illegally using invoices, using unlawful invoices that are subject to sanctioning under Article 16 (Sanctioning of the acts of making incorrect declaration, leading to a sufficiency in the payable tax amount), Article 17 (Sanctioning of the acts of tax evasion) of Decree No. 125/2020/ND-CP, the sanctioning under Article 28 (use of illegal invoices or illegal use of invoices) of Decree No. 125/2020/ND-CP shall not apply.

In case a taxpayer failing to make invoices within the prescribed time is subject to violations of regulations on the formulation of invoices (Article 24 of Decree 125/2020/ND-CP) and the acts specified at Point c Clause 1 Article 17 of Decree 125/2020/ND-CP, the taxpayer shall be sanctioned for each violation according to regulations.

b) Regarding the time of committing the act of failing to make invoices within the prescribed time

Points c and d Clause 1 Article 8 of the Government's Decree No. 125/2020/ND-CP dated October 19, 2020 define:

“c) The in-progress administrative violations related to invoices that are violations specified in Clause 4, Article 21; Point b, Clause 2 and Clause 3, Article 23; Clauses 2 and 5, Article 24; Point b, Clause 3, Article 25; Point b, Clause 2 and Points b, c and d, Clause 3, Article 27; Point b, Clause 5, Article 29; and Point b, Clause 3, Article 30 of this Decree.

d) Administrative violations related to invoices other than those prescribed at Point c of this Clause are completed administrative violations.  The time of termination of a violation is the date on which such violation is committed.”

Accordingly, the time of termination of a violation on invoice issuance prescribed in Clauses 1, 3, 4 Article 24 of Decree No. 125/2020/ND-CP is the date on which such violation is committed (date of invoice issuance). In case a taxpayer commits many violations of failing to make invoices within the prescribed time, the tax agency shall, based on the times of termination of violations (dates of invoice issuance), sanction on each violation according to regulations.

The General Department of Taxation provides the guidance for the Tax Department for implementation./.