Long-lasting difficulties in budget collection of tax sector

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Accumulated state budget revenue in seven months managed by Tax agency is estimated at VND666,080 billion VND. Photo: Thuy Linh.

Revenue did not increase over the same period last year

According to the latest report from the General Department of Taxation, the state budget revenue in July 2020 managed by the tax sector is estimated at VND91,600 billion. This revenue is only 7.3% of the estimate, or 70.2% from the same period in 2019.

In particular, revenue from crude oil is only 36% compared to the same period last year; and domestic revenue is estimated at 71.5% compared to the same period in 2019.

Revenue excluding land use fees, dividends and remaining profits and revenue from lottery and the difference between the State Bank's revenues and expenditures represent 71.1% over the same period in 2019.

Thus, the accumulated State budget revenue in seven months managed by the tax agency is about VND666,080 billion. This revenue is equal to 53.1% of the estimate, or 91.5% compared to the same period in 2019.

According to the General Department of Taxation's analysis, the revenue collected by the Tax agency in the first seven months of 2020 is the lowest compared to the revenues of recent years in both progress and speed (revenue in seven months of 2019 was 57% of the annual revenue, up 11.8% over the same period in 2018; in 2018 it was 56.7%, up 16.2%; and in 2017, 54.8%, up 16.1%).

The revenues gradually decreased and sharply decreased from April onwards.

According to the General Department of Taxation, the economic situation in the first seven months of 2020 was greatly affected by the Covid-19 pandemic, especially the implementation of the Government's guidance on the implementation of measures to prevent the disease including social distancing in April, especially in big cities and provinces like Hanoi and Ho Chi Minh City.

Therefore, during the social distancing period, most non-essential services must be closed;and other production and business activities were restricted, affecting the production and business activities of enterprises.

Since May, the pandemicin Vietnam has basically been controlled, the economy has gradually been reopened, but the level of recovery was still very slow.

Also according to the General Department of Taxation, the implementation of the Government's solution packages to support enterprises, organizations and individuals affected by the Covid-19 pandemic according to Government’s Decree No. 41 / ND-CP has sharply reduced the budget revenue in the first seven months, especially since April.

Strictly manage operations of enterprises

With the impacts of reduced revenue from policies and disease, though the state budget revenue managed by the tax agency did not grow compared to the same period in 2019 (only 91.5%), to get results, it was because the tax agencies at all levels simultaneously carried out many solutions to manage revenues.

Accordingly, the General Department of Taxation directed tax departments to deploy revenue estimates from the first day and the first month; assigned tasks of inspection and examination of enterprises in 2020 to the tax departments.

Along with that, focusing on timely and effective implementation of revenue management solutions andreviewing all enterprises registering for business to put into tax management, inspectingall taxpayers announcing ceasing of operations; strictly controlling the value-added tax refund to ensure tax refunds in accordance with the provisions of law; and strengthening the management of sales invoices.

According to the General Department of Taxation, the tax agency has focused on inspecting and reviewing the number of enterprises registering for business, the number of enterprises temporarily suspending and ceasing operations, especially after the Lunar New Year and the number of taxpayers announcing the suspension and ceasing of operations during the disease outbreak in the country. Thereby,it is ensured to put 100% of taxpayers engaged in business into tax administration for strict control of production, business, tax declaration and payment of enterprises.

Along with that, the tax agencies at all levels continue to identify subjects and adjust the presumptive tax rates to suit business reality and combat the loss of state budget revenues.

According to statistics, in the first seven months of the year, tax agencies at all levels conducted 32,851 inspections, reaching 35.53% of the plan in 2020; inspected 301,420 tax records at the tax office.

Tax sector’s revenue affected by Decree 100 VCN- According to the latest report of the General Department of Taxation, the Tax sector’s revenue in ...

The total revenue through inspectionswas VND30,695 billion; increasing state budget revenue by VND10,915 billion. In particular, 104 enterprises engaged in related-party transactions were inspected; tax arrears and fines were VND269 billion; reduced losses totaled VND1,785 billion and taxable income was revised up VND2,373 billion.