Officials' response key to tax reform success

Officials' response key to tax reform success

It will be difficult to reduce the time required for tax payment to 171 hours annually by 2015, if tax officials don't work towards resolving the difficulties faced by businesses.

Huong Vu, deputy general director of tax and advisory services at EY Viet Nam, said this at the Tax Symposium 2014, held in Ha Noi yesterday.

"There are several requirements for submitting invoice declarations, despite the Prime Minister's and the ministries' efforts to reform administrative procedures," Huong said.

Studies by EY show that enterprises have to spend some time to report their use of invoices, even though authorities have cut a range of administrative procedures.

There is no difference in meaning among several words in invoices, but they cause confusion, and are hurdles for companies towards reducing the time spent on tax payment.

For example, the columns entitled "cancelled" and "deleted" in invoices have caused confusion. If the firms fill in the wrong information, the entries have to be rewritten and the companies are fined.

In addition, companies have to issue invoices when transferring ownership. However, it forces large firms that send several shipments of goods daily to prepare several invoices. "The regulation is not suitable and has taken a lot of time of businesses," Vu said, suggesting that bills should be issued weekly or monthly, instead of for each shipment.

She affirmed that the biggest challenge for reducing tax administrative procedures, stipulated in 119/2014/TT-BTC ("Circular 119"), was to provide amendments and guidance to simplify certain tax administrative procedures in line with the spirit of being humane or specifically for tax officials who ask for several documents.

For example, the demand for extra documents can be seen in the case of personal income tax exemption for specialists in ODA projects.

The current regulations do not require tax payers to declare the amount of tax to be paid, if they are not benefiting from tax exemption.

However, some tax officers have insisted on the declaration being submitted.

This year has seen significant changes in tax administration and new guiding rules for laws impacting every aspect of taxation in businesses.

The Tax Symposium 2014, co-organised by EY Viet Nam and CFO Viet Nam, reviewed the tax changes as well as practical experience in tax payment, audit and inspection, besides the disputes enterprises have faced in recent years. 

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