On the afternoon of April 23, continuing the 32nd session, the Standing Committee of the National Assembly gave its opinion on the draft Law on Value Added Tax (amended).
Presenting the examination report, Mr. Le Quang Manh, Chairman of the Finance and Budget Committee, said that the issue of great concern to the investigation agency is the inclusion of provisions on not collecting value added tax (VAT) on gifts, donations, properties falling within the import tax exemption threshold, and the exemption of VAT on imported goods of small value.
Mr. Le Quang Manh, Chairman of the Finance and Budget Committee. (Photo: Duy Linh)
According to Mr. Le Quang Manh, the exemption of VAT on imported goods of small value derives from the fact that the tax revenue is insignificant compared to the cost of tax administration by the customs authorities and the cost of tax compliance by taxpayers.
” Previously, the quantity of imported goods of small value was not too large, so the overall impact on tax revenue was insignificant. Currently, with the boom of cross-border e-commerce, the common trend in many countries shows that the volume of cross-border trade in goods of small value has increased several times in recent times “, Mr. Le Quang Manh stated the reality.
The examination report cites data from the Vietnam Posts and Telecommunications Corporation, indicating that as of March 2023, there were an average of approximately 4–5 million orders per day being transported from China to Vietnam, with the value of each order divided into 100,000–300,000 VND.
Daily, there is an average of approximately 45–63 million USD, and monthly, there is approximately 1.3–1.9 billion USD worth of goods being circulated through the platforms Shopee, Lazada, Tiki, TikTok, etc.
” Currently, many countries have removed the provision on the exemption of VAT on imported goods of small value to protect tax revenue and create an equal business environment between domestically produced goods and imported goods. Therefore, it is recommended that the Government refer to the general trend to consider removing this provision, facilitating the expansion of and generalizing tax revenue sources in the context of current budget constraints “, the Chairman of the Finance and Budget Committee said.
Speaking at the meeting about the subjects not subject to VAT, Mr. Vuong Dinh Hue, Chairman of the National Assembly, raised the issue of whether the press and publishing sector is included in this draft law.
” Currently, both print and electronic newspapers are facing difficulties. Previously, we only mentioned print newspapers, but now electronic newspapers are also encountering challenges due to the strong development of online platforms. The press economy is facing a great deal of hardship in the conditions of the strong development of advertising on online platforms. The comrades should conduct further research on this issue “, the Chairman of the National Assembly said.
Mr. Vuong Dinh Hue, Chairman of the National Assembly. (Photo: Duy Linh)
In addition, the Chairman of the National Assembly also requested further research on the opinions of scientists and intellectuals on the proposal to include specialized books in the subjects exempt from VAT.
According to the Chairman of the National Assembly, currently, the draft law only refers to textbooks, while specialized books contain a very high scientific content, a higher type of knowledge, and need to be encouraged.
Mr. Vuong Dinh Hue, Chairman of the National Assembly, said that the draft law lists 26 groups of subjects not subject to tax, in which 10 groups of goods are transferred to be subject to 5% tax.
” However, many opinions have been expressed suggesting that revisions be made, arranging these 26 groups of subjects to be compatible with the list of sectors and fields according to the Vietnamese economic sector system. This is a suggestion for research so as to ensure compatibility with the classification of business sectors… to facilitate monitoring and prevent omissions “, the Chairman of the National Assembly remarked.
Mr. Vuong Dinh Hue, Chairman of the National Assembly, suggested that perhaps it is necessary to conduct research to supplement certain violations, prohibited acts, and sanctions. Because this is a tax law on policy, in addition to the prohibitions already stipulated in the Law on Tax Management, due to the special nature of VAT, many violations may arise, so deterrence is needed.
Therefore, the Chairman of the National Assembly believes that it is possible to conduct research in the general provisions to add a clause addressing the prohibited acts and sanctions for cases that have not been specifically detailed in the Law on Tax Management.
” For example, acts of fraudulent invoicing, document fraud, violations of tax payment time, tax deductions, tax refunds, tax fraud, forgery of VAT invoices, establishment of business establishments for the purpose of selling VAT invoices… “, the Chairman of the National Assembly, Mr. Vuong Dinh Hue, stated.
