Focus on inspecting businesses with high tax risks

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The tax agency has continued to focus on promoting taxation and tax inspection by identifying risks of tax declaration dossiers at the tax office. Photo: T.Linh.

Inspecting by risk method

The latest figures of the General Department of Taxation show that, in the first six months of the year, tax authorities at all levels have inspected and checked 35,344 enterprises, reaching 40.5% of the yearly plan. Since then, the total number of petitions handled through inspection and examination has reached 20,546 billion VND (equal to 118% compared to the same period in 2018). In particular, the revenue increased by more than 5,691 billion VND; deduction is 929 billion VND; loss of 13,924 billion VND.

According to statistics, by the end of June, the whole tax industry has conducted inspections of 150 enterprises with associated transaction activities. The amount of retrospective collection, reimbursement and fines of more than 693 billion VND; loss of 2,488 billion VND; deducting 9.04 billion VND deduction and increasing taxable income over 2,661 billion VND.

According to the General Department of Taxation, the tax inspection work of the whole industry has brought into play certain effects, helping to enhance discipline in taxation and preventing state budget revenue loss.

At Hanoi Taxation Department, from the beginning of the year until now, the Tax Department has continued to focus on promoting taxation and tax inspection by identifying risks of tax declaration dossiers at the tax office. Accordingly, 100% of businesses are analyzed for risks before issuing decisions on inspection. Tax agencies also focus on inspecting enterprises with high tax risks, businesses showing signs of tax evasion, trade fraud and transfer pricing, thereby contributing to the work of budget collection.

According to the statistical results of the unit, the inspection results at the tax office in the first six months of 2019 have adjusted to increase 14.5 billion VND of payable tax; value added tax reduction is deducted amount of 598 million VND; loss of more than 10 billion VND. Along with that, by the end of June, in the inspection work at the taxpayers' office, Hanoi Tax Department has completed 7,494 inspections, reaching 45.1% of the assigned plan. Since then, the total number of arrears, recourse and fines is 1,191 billion VND; reduction of Value Added Tax is deducted more than 84.1 billion VND; loss of 827 billion VND.

Notably, according to the Hanoi Taxation Department, in addition to inspections and checks to prevent violations, Hanoi Tax Department collaborated with the City Social Insurance Agency and the City Labor Federation to conduct checks on social insurance premiums and trade union fees. Thus, in the first six months of 2019, 645 organizations and enterprises detected signs of violation of social insurance deductions; 647 organizations and enterprises showed signs of violation of deduction for trade union funds.

Hanoi Taxation Department has also continued to strengthen close coordination with the Public Security agency in the fight against loss of revenue; detect, prevent and promptly handle frauds and tax evasion, especially acts of buying and selling, using illegal invoices. According to statistics, accumulated in the first six months of 2019, the Department of Taxation has transferred documents to coordinate with the Police Department 624 to request verification of invoices relating to 5,633 invoices with total tax of 38.3 billion VND.

Paying attention to inspecting industries with high tax risks

The General Department of Taxation said that, as a result of the inspection and tax examination for the first six months of the year, it should be noted with positive results. However, this work is still difficult.

In fact, currently the resources of staff working in inspection work are still limited, while the number of enterprises needing inspection and examination is increasing. Moreover, the inspection against price and profit transfer has been focused, however, due to the complex nature of the associated transaction (both domestic and transnational), it is still difficult to implement.

Hanoi Department of Taxation also admitted that, although the work of taxation and inspection has made strong changes in the methods of implementation, which have brought about efficiency and increases in both quality and quantity but in some areas such as inspection of prices and capital transferring, real estate, e-commerce, anti-revenue loss solutions have not achieved the desired results.

The leaders of the General Department of Taxation said that from now until the end of the year, the whole Taxation Department will step up the implementation of tax inspections and examinations according to the risk management method. Striving to inspect and check at taxpayers' offices at least 19% of the number of taxable enterprises. At the same time, the General Department of Taxation will continue to build an electronic monitoring and inspection system.

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In particular, in big cities like Hanoi and Ho Chi Minh City, the tax agency will take the initiative in selecting the subjects of inspection and examination according to the key risk principles and high social sensitive issues, specific occupations, business sectors, high risks such as capital transfer, real estate transfer, e-commerce, transfer pricing and non-traditional businesses.