Strictly managing VAT refunds in the last months of 2016

There are no VAT refund for some specific cases. Photo: Thu Hằng

In the beginning of 2016, the General Department of Taxation has focused totally on tax refunds, ensuring to reach the target and meet deadlines in accordance with the provisions of the law on tax refunds. By the end of July 2016, the General Department of Taxation issued 12,173 decisions on tax refund with the total amount of 58.370 billion VND. Since July 2016, the General Department of Taxation has monitored tax refund automatically via the centralized tax management (TMS).

According to the General Department of Taxation, in the last months of the year, the agency will strictly control the number of VAT refunds; through implementation review and analysis of information on tax refunds, return to select those with signs of risk in reimbursement, in addition to planned inspections, and inspections after tax refund. At the same time, coordinating with other authorities to promptly detect and strictly handle acts of fraud, abuse of VAT refund, the full recovery of refunds in accordance with bank fraud State policy.

Notably, recently, in Official Letter No. 13804/BTC-TCT regarding refunds of VAT in the last months of 2016, the Ministry of Finance has asked the Tax Departments of provinces and cities to manage VAT refunds according to law, with no VAT reimbursement in some cases.

Specifically, for goods and services exports, to not make refunds for export cases which do not export in operation area under the provisions of the Customs Act and stipulated in detail about operation areas of Customs in Decree No. 01/2015/ND-CP of the Government providing details of the geographical areas of Customs operation; and be responsible for coordinating the prevention of smuggling and illegal transportation of goods across the border.

Moreover, no refunds for export cases that are resource products, mineral extraction not been processed into other products, or products for export as processed goods from natural resources, or minerals natural resources, and minerals plus energy costs accounting for 51% production cost of their products.

For investment projects, the Ministry of Finance asked not to refund for any investment project of business which don’t contribute sufficient chartered capital as registered; Business investment without sufficient business conditions as stipulated in the Investment Law or that don’t maintain adequate business conditions during operation; Investment projects for exploiting natural resources and minerals that are authorized from July 1^st 2016. In contrast, investment project of goods production that have a total value of natural resources and minerals plus energy costs accounting for 51% or higher product costs under investment projects.

Besides, in cases of the taxpayer has input VAT accumulated for 12 months or 4 consecutive quarters and has not been deducted, the Ministry of Finance requests reimbursement made only to cases where the taxpayer VAT cannot be deducted incurred prior to the tax period to July 2016 (for cases listed by month) or the tax period of the third quarter of 2016 (for quarterly declaration) qualification completed tax under guidance in Clause 1 of Article 18 of Circular No. 219/2013 / TT-BTC guiding the implementation of the VAT Law and Decree No. 209/2013/ND-CP of the Government dated 18-12-2013 detailing and guiding the implementation of some provisions of the VAT Law.

Particularly, for reimbursement dossiers lodged before July 2016 or the third quarter for cases mentioned above, due to policy changes and high risk, the Ministry of Finance requested the Tax Department to inspect advance tax refunds for all records requesting tax refund. For these cases, the Taxation agency has to update fully and timely all records, test results of the tax department into the tax administration system (TMS) in order to General Department of Taxation implement the supervision before tax department issued a tax refund decision.

With records not subject to the provisions above, the Ministry of Finance requested the Tax Department to apply grounds specified in Law No. 106/2016/QH13; Tax Administration Law No. 21/2012/QH13 and guiding documents to implement sorting records refunds prior to examination or inspection before tax refund in accordance with regulations.