Commenting on the draft law, Chairman of the National Assembly (NA) Vuong Dinh Hue requested the drafting agency to research and supplement regulations on prohibited violations and sanctions related to value added tax (VAT). ) in the draft law. According to the Chairman of the National Assembly, although the Law on Tax Administration has regulations on prohibited acts in the tax field, VAT has a specific nature and in fact gives rise to many violations, so additional research can be done. supplement this regulation.
National Assembly Chairman Vuong Dinh Hue spoke at the meeting
The Chairman of the National Assembly also stated that it is possible to add unspecified violations in the Law on Tax Administration such as fraudulent invoices and documents, violations of tax payment time, tax deduction, tax refund, fraud. Appropriating taxes, declaring false VAT invoices, setting up business establishments to sell illegal VAT invoices, transfer pricing…
The addition of regulations on prohibiting acts and sanctions for handling VAT fraud was also proposed by many members of the National Assembly Standing Committee. Chairman of the National Assembly Economic Committee Vu Hong Thanh said that in fact, violations in the field of VAT such as tax fraud and tax evasion are quite common. According to Mr. Thanh, the Tax Administration Law 2019 has regulations on prohibited acts, but the VAT Law is more special and specific, so there needs to be separate regulations to prevent invoice and document fraud and time violations. Paying taxes, deducting taxes, refunding taxes, fraudulently appropriating taxes and declaring false VAT invoices…
Explaining later, Minister of Finance Ho Duc Phoc also agreed that in the recent period there was large VAT fraud. Therefore, strict and transparent regulations are needed to protect both genuine taxpayers and collectors.
Proposal to levy VAT on imported goods via Shopee and Lazada
Previously, in the preliminary inspection report of the law project, Chairman of the National Assembly Finance and Budget Committee Le Quang Manh proposed that the Government consider removing the regulation on VAT exemption for imported goods of small value. According to current regulations, imported goods sent via express delivery service with a value of 1 million VND or less are exempt from import tax and VAT.
Mr. Manh said that the VAT exemption for imported goods of small value is based on the fact that the amount of tax collected is insignificant compared to the collection management costs of customs authorities and the compliance costs of traders. taxpayer. Previously, the quantity of small-value goods imported was not too large, so the overall impact on revenue was insignificant.
However, Mr. Manh said that currently, with the explosion of cross-border e-commerce, the general trend of many countries shows that the number of cross-border transactions of small value goods has increased many times over the past few years. last time.
Mr. Manh cited data from the Vietnam Posts and Telecommunications Joint Stock Corporation: in March 2023, there were an average of about 4 – 5 million orders/day from China to Vietnam, with the value of each order ranging from 100,000 – 300,000 VND. Accordingly, every day an average of about 45 – 63 million USD, a month about 1.3 – 1.9 billion USD worth of goods are circulated through e-commerce platforms Shopee, Lazada, Tiki, TikTok…
According to the Chairman of the National Assembly Finance and Budget Committee, many countries have now abolished VAT exemption regulations for small-value imported goods to protect revenue sources and create a fair business environment between manufactured goods. domestic and imported. From there, the inspection agency requested the Government to refer to the general trend to consider removing this regulation, creating conditions to expand and cover revenue sources in the context of current budget constraints.
Another proposal of the National Assembly’s inspection agency is to increase the VAT rate according to the roadmap. Chairman Le Quang Manh said that VAT currently applies 3 tax rates: 0%, 5% and 10% respectively. The Finance and Budget Committee believes that the common tax rate of 10% is currently low compared to other countries.
Mr. Manh cited the average tax rate in Asia as 12%, Latin America as 14%, Africa as 16%, and Europe as 22%. The global average VAT rate is 15%. The Chairman of the Finance and Budget Committee also said that some ASEAN countries have increased VAT as a revenue collection solution after the Covid-19 epidemic.
Explaining further, Minister of Finance Ho Duc Phoc said that businesses are facing difficulties, so the National Assembly decided to reduce the tax rate from 10% to 8%. This helps businesses overcome difficulties. Therefore, the Minister of Finance believes that the current tax rate of 10% is appropriate.
Also on the afternoon of April 23, the Standing Committee of the National Assembly closed the 32nd session. In the closing speech, Chairman of the National Assembly Vuong Dinh Hue affirmed that after 4.5 working days, the 32nd session of the National Assembly Standing Committee had concluded. Complete all content; Review and give opinions on 19 contents and give written opinions on 3 Government reports.
VAT rate on fertilizers is 0% or 5%?
The fact that the Government has included fertilizer products subject to VAT at a 5% tax rate instead of not being subject to tax as currently is of interest to many members of the National Assembly Standing Committee. Chairman of the National Assembly Law Committee Hoang Thanh Tung expressed his approval that the draft law included fertilizer products as taxable. According to Mr. Tung, this is an inadequacy that has been raised for many years, affecting the competitiveness of fertilizer production enterprises when input VAT refunds are not deducted (due to VAT exemption), leading to higher prices. become increased. However, Mr. Hoang Thanh Tung is concerned when fertilizer products, from being non-taxable, are now proposed by the Government to be subject to 5% VAT. “We request clarification to determine whether the tax rate is 5% or 0%. Because 5% is not new. The 2008 VAT Law stipulates that fertilizers are subject to a 5% VAT rate. However, By 2014, when the law was amended, fertilizer was not subject to VAT. Now that it is back to 5%, it must be clarified why we abandoned it in the past and why it is now set at 5%. “, Mr. Tung stated. Chairman of the National Assembly Vuong Dinh Hue also requested the drafting agency to explain this issue carefully. “The tax calculation is correct, very appropriate, but whether the tax rate should be 5% or 0% requires a more thorough analysis. I try to focus on explaining with a little basis to convince because It hasn’t been fixed for a long time,” the Chairman of the National Assembly noted.
