Strengthening Measures to Prevent Fraudulent Use of Invoices

The tax sector has launched an electronic invoice (e-invoice) system nationwide, according to the Ministry of Finance. The e-invoice system keeps track of all data of the buyer and the seller, so in case the buyer or the seller has committed an illegal act of buying and selling invoices, it will be detected and handled by law.

Competent authorities need to take action together to detect illegal purchases and sales of invoices 

To detect illegal purchases and sales of invoices early, authorities need to take action together. For its part, the tax sector is fostering invoice management based on risk analysis of high-risk taxpayers. Accordingly, taxpayers with suspected signs of fraudulent use of high-risk invoices will be examined and inspected.

Along with inspection and examination, the tax sector also seriously compares taxpayer information/data in tax declaration forms and e-invoice data created by taxpayers to make a list of taxpayers with record and data discrepancies and ensure correct and sufficient declaration to keep tax payment on time.

Tax authorities also control e-invoice information and check early warning signs to figure out cases that need regular monitoring and inspection. To prevent the use of blank e-invoices early, taxpayers will be warned about unusual or sudden changes compared to their normal business activities when they issue invoices. This will be done on a daily basis to circumvent and warn against the issuance of invoices by taxpayers with signs of risk.

In addition, the tax sector is researching and applying big data processing technology and artificial intelligence technology to analyze e-invoice data with the following contents: natural language processing, machine learning, statistical identification of goods and services, determination of the extraordinary value of merchandise, identification of buying-selling chains, and assistance for the E-Invoice Data Analysis Center to detect fraudulent cases and purchase and selling of suspicious invoices.

In response to the Ministry of Finance’s Official Dispatch 01/CD-BTC dated April 12, 2023 on strengthening management and supervision of e-invoice issuance and use, the General Department of Taxation issued Directive 01/CT-TCT dated April 11, 2023 on strengthening measures to review and check invoices in order to prevent fraudulent use of invoices.

The tax sector has been communicating extensively with people and businesses through various media channels such as newspapers, websites, television and other means and environments to inform them about legal policies on taxes and invoices. They have also been publicizing information on prosecuted organizations and individuals who have been involved in buying and selling invoices to warn and deter those who intend to breach invoice laws.

The sector has been reviewing individuals and organizations that purchased invoices to declare VAT deductions and tax refunds, legalize uncertified goods, and reduce expenses for calculating corporate income tax. Violations are strictly handled in time by law.

By Le Hien, Vietnam Business Forum