Tax debt elimination contributes to financial transparency

	Many dissolved businesses have tax debts written-off
	Tax collection from business section increases by 13.6 percent
	Clear legal gap to remove tax debt

Mr. Tran Quang Chieu, Standing Member of the Committee of Budget and Finance of the National Assembly.

According to the report of the Ministry of Finance, together with the legalization of cases of tax debt elimination in the Tax Administration Law, the Ministry of Finance is drafting a Resolution on handling tax debts for taxpayers who are unable to pay. What is your opinion onthe Resolution?

There have been three additions and amendments of the Tax Administration Law since 2006; however, it does not have regulations on handling tax debts, so the amount of tax debt, penalties for late payment, and delayed payment is constantly increasing over the years.

The Tax Administration Law No. 38/2019/QH14 (2019 Law on Tax Administration) which has just been approved by the National Assembly and will takeeffect from July 1, 2020, has specific provisions on freezing tax debts,eliminating tax debt, fines, and late payments.However, these regulations are applicable to taxpayers arising from July 1, 2020 onwards.Therefore, in order to clear this gap, I think that it is necessary to issue a Resolution on handling tax debts for taxpayers who are unable to pay.

In essence, the elimination of tax debt includes principal debt, tax debt, penalty of late payment.It should be asserted that this is not the removal of real money, but tax obligations, in other words, nominal money, not bad debt of the bank (because the bad debt of the bank is that a bank lends with real money and losesreal money). Tax debt elimination does not cause damage to the state budget. If we can collect it, the state budget will have revenue.

Along with the implementation of handling tax debts according to the Resolution, propaganda for people to understand it is very important. The cases under the Government's proposal are unrecovered. In the Government's report, it was clearly stated that the target of debt elimination was the dead, missing, bankrupt businesses and places of business that cannot be tracked.If this situation persists, it will not reflect the financial situation substantially, because unrecoverable tax debt is mainly the late payment interest in addition to the principal.Therefore, it is necessary to remove the tax debt to ensure the structure of the state budget, contributing to financial transparency.

Has the resolution of tax debt eradication been guaranteed to taxpayers, sir?

In order to ensure transparency, in addition to being publicized in accordance with the new Law on Tax Administration, it is also necessary to clearly state in case the enterprise has a decision to eliminate the tax debt, but it is found to be in business again, the decision will be canceled and the enterprise must pay the tax debt to the state budget. That is an additional issue to avoid policy abuse.

Or in the provisions on the authority to eliminate tax debt, in addition to being held responsible in accordance with the law on duty performance, a higher discipline will be applied in case of a violation. In my opinion, this regulation should be added to the draft Resolution.

The 2019 Law on Tax Administration does not stipulate the establishment of a tax debt elimination advisory council, but specifically for this Resolution, the council should be set up.Because the eliminated amount of money is not small and there are many objects in this component.Therefore, to ensure transparency and publicity, a Consulting Council should be established and it will dissolve itself when the task is completed.

Thank you, sir!