Tax Authorities Refund over US$2.6 Bln to Businesses in H1

In response to Official Dispatch 470/CD-TTg from the Prime Minister and guiding documents from the Ministry of Finance, the General Department of Taxation (GDT) has directed tax authorities at all levels to focus resources on processing VAT refund applications to provide maximal capital support for companies to do better business. This has resulted in very encouraging outcomes.

Tax authorities at all levels assist taxpayers in preparing and filing tax refund applications to tax offices efficiently

June tax refund is 45% higher than five months’ average

Carrying out the direction of the Prime Minister and guiding documents from the Ministry of Finance, the GDT has requested tax authorities at all levels to responsibly allocate adequate resources for the urgent completion of tax refund examination into tax refund applications filed by taxpayers.

To promptly capture problems and propose tax refunds to tax authorities, the GDT established a workgroup to work with tax authorities on the settlement of VAT refunds, report and advise the GDT to assign relevant bodies to introduce VAT refund solutions in a timely manner in line with the directions of the Prime Minister and the Ministry of Finance. Tax authorities held dialogues with 63 companies that faced difficulties in completing tax refund records. The progress of tax record settlement was notified to taxpayers in a public and transparent manner by tax authorities.

Tax refund management was implemented and controlled strictly to ensure that the tax was refunded to the right entities and was compliant with the law. To detect, prevent and promptly handle violations and frauds in VAT refunds, tax authorities at all levels continued to perfect the Steering Committee and its assistant Standing Team to intensify inspection against VAT refund frauds. Tax authorities promptly issued Official Dispatch 2099/TCT-KK dated May 26, 2023 and Official Dispatch 2426/TCT-KK dated June 15, 2023 in order to direct and strictly implement VAT settlement in a timely, lawful, public and transparent manner. Thus, in the first six months of 2023, tax authorities issued 8,510 VAT refund decisions for a total amount of VND61,093 billion (US$2.65 billion), equal to 33% of the VAT refund amount in 2023 approved by the lawmaking National Assembly.

Some tax departments outperformed tax refunds. The Hanoi Tax Department refunded VND3,058 billion, which is 25% higher than the same period in 2022. Tax departments of Ba Ria-Vung Tau, Binh Duong, Dong Nai and Ho Chi Minh City reimbursed VND2,391 billion, VND10,373 billion, VND7,612 billion and VND2,396 billion respectively.

Speeding up tax refund, business support

Based on VAT refund management results in the first six months of 2023, especially the tax refund in June, the General Department of Taxation will continue to request leaders of tax offices to further direct and coordinate in VAT refund management. Accordingly, the GDT will require local tax departments to strictly report VAT refund results before 16:00 every Friday.

At the same time, tax authorities should continue to hold dialogues with associations and businesses with long backlogged VAT refund records to figure out matters and actively handle and solve problems within their competence. If the matters are beyond their authority, they must promptly report them to the GDT for guidance.

The GDT will also request tax authorities at all levels to strengthen communications on tax refund records and procedures to help taxpayers effectively prepare and submit tax refund applications to tax offices. At the same time, it will promptly notify taxpayers of the progress and status of VAT refunds in a transparent and public manner. Moreover, tax authorities at all levels need to reinforce inspection and post-refund examination into tax refund records subject to promptly detect the use of illegal invoices or illegal use of invoices.

By Huong Hau, Vietnam Business Forum