South Korean firms seek predictable tax and customs policies in Vietnam

South Korean firms seek predictable tax and customs policies in Vietnam

South Korean investors expect to have a clear and predictable tax and customs policy system, which helps them achieve their aspiration for long-term business and grow together with Vietnamese businesses.

Photo: KoCham

This was the opinion of Ko Tae Yeon, chairman of the Korean Chamber of Commerce in Vietnam (KoCham), at the dialogue between the Ministry of Finance (MoF) and South Korean businesses on October 21.

“First, we respectfully request that your agency expedite and make the VAT refund process – an indirect tax – more predictable. We expect the MoF to consider improving the mechanism, applying artificial intelligence and data to enhance the efficiency of assessment, ensuring that businesses meet the eligibility criteria for VAT refunds according to the established procedures. Furthermore, if businesses can track the progress of tax refunds and the expected completion date, financial planning will be easier. We hope the MoF will consider this approach to the tax refund process,” Ko said.

"Besides that, South Korean businesses hope that tax audits and inspections will be conducted according to clear and predictable criteria and procedures. The MoF should announce the criteria and procedures in advance and provide complete information so that our members can prepare. When tax audits and inspections are conducted consistently and predictably, businesses will have more confidence in the system and can focus more on their business operations," he said.

Another proposal is to implement an operational plan to ensure that customs clearance can be maintained continuously 365 days a year.

According to KoCham’s members, businesses' production and logistics activities still take place on weekends and holidays. If customs clearance is delayed, it will impact the supply of raw materials and components, and production schedules and delivery deadlines, leading to delays for partners and the entire supply chain.

“To enhance global competitiveness, the efforts of businesses are needed along with coordination between policy support and practical implementation. We believe that a 24/7 operational plan should be developed to ensure that key operations affecting businesses' production and logistics are handled smoothly even on weekends and holidays. We also suggest considering measures to expand the application of electronic customs clearance and the authorised economic operator programme,” Yeon said.

Furthermore, many South Korean firms hope for a mechanism to quickly and regularly inform businesses about changes in tax and customs policies.

“We understand that government agencies are providing relevant information through various portals and notification channels. To enable Korean businesses to easily access important changes at a single location, we respectfully request that MoF develop a comprehensive information portal providing relevant legal documents, effective dates, links to the original documents, and summaries in Korean. For its part, KoCham will forward relevant information to its member businesses, share business questions and opinions with relevant authorities, and continue to maintain regular exchanges between the government and businesses,” he said.

“We hope that these proposals will contribute to more stable business operations in Vietnam, and facilitate the expansion of investment and cooperation in the long term. When the tax and customs systems develop in a clear and predictable direction, businesses will be able to grow together with local partners and continue to make sustainable contributions to the Vietnamese economy,” he added.

VIR