Building Business Trust in Electronic Tax Payment

Electronic tax payment is one of driving forces that change corporate governance towards transparency and modernity to catch up international trends. It will help improve the business environment and enhance national competitiveness, especially when Vietnam signed a free trade agreement (FTA) with the European Union (EU) and opened new trade cooperation trends with foreign countries. Companies will find it more convenient with electronic tax payment than other forms, including debit authorisation form. Companies can do the taxing at any time, including holidays. Successful transactions will be confirmed immediately. A foreign entity always wants to work with companies with transparent accounting. A company using so much money for daily transactions will cast doubts over foreign partners. Nevertheless, it is a long distance from registration to payment because the number of tax payment receipts and tax value paid electronically remains small. To complete the target of at least 90 per cent of companies paying tax online, Vietnam needs measures to remove obstacles relating to the common law system, as well as consistent coordination from tax authorities to intermediary units such as banks, payment intermediaries and taxpayers. First and foremost, it is vital to build business confidence and make them feel confident with non-cash tax payment.

 

Many companies proposed that the tax sector needs to improve its software system for easier working. Whenever a new regulation is effective, it must be updated into the software. Companies must be notified of the software upgrade, enabling them to follow the new regulations and software. Companies tend to pay taxes just ahead of deadline because they want to use their money to the very last day. For that reason, the information technology infrastructure plays a very important role. The Government must direct big information technology companies to develop and operate information systems to upgrade transmission lines to ensure fast and smooth tax declaration. Then, it must persuade companies to register electronic tax payment.

 

Reportedly, communication by means of mailing written documents is untimely and not effective, particularly in big cities like Hanoi and Ho Chi Minh City. Many localities have diversified their communication methods to fit their conditions and contexts. For example, in Danang City, the tax sector has coordinated with commercial banks to organise “electronic tax payment registration day” and invite companies to join events relating to this issue. In poorer localities, tax officers have to work and move more to contact, explain and persuade companies to register and use electronic tax payment.

 

Banks and payment intermediaries must also work with each other to support electronic tax payment. According to surveys, the State Treasury needs to open only one account at a commercial bank. Money transfer will be very hard if the interconnection between two banks is not good or it is very annoying if taxpayers input incorrect information of recipients already on the system.

 

For companies, information technology level needs to be improved. Many business leaders and executives lack IT knowledge and they are not keen on internet and computers. This results in hesitancy in paying electronic tax. For this reason, the Government needs to provide specific guidelines and support for businesses to apply and internal management software, install digital signature, electronic tax declaration and payment management system.