Consequences for Buyers and Sellers Involved in Underreporting Invoices to Evade Taxes

On December 24th, the Da Nang Electronic Information Portal, in collaboration with the Da Nang Tax Department, hosted a live seminar titled: “Eliminating Lump-Sum Tax – Preparing Businesses for Electronic Tax Filing and Payment Starting January 1, 2026.”

During the seminar, in response to a question about calculating tax using the revenue minus expenses method multiplied by a ratio, and how businesses should handle situations where suppliers issue invoices below the actual value, Ms. Nguyen Thi Thu Luong, Deputy Head of Tax Office 3, acknowledged that this is a common issue in practice. She noted that some businesses still attempt to evade taxes by reporting lower revenue than actual sales.

To protect the interests of both buyers and sellers, Ms. Luong emphasized that businesses must comply with regulations and issue invoices accurately reflecting actual transactions. If a seller fails to issue an accurate invoice, the buyer has the right to report this to authorities, who will then require the seller to comply with regulations: all sales must be invoiced, and invoices must reflect the true transaction value.

Primarily for their own benefit, businesses should directly engage with partners to ensure accurate invoicing. Payment records must align with invoice values. Whether using the ratio-based tax method or the revenue minus expenses method, all input invoices reflect purchasing activities, while output invoices are only issued for valid inputs.

According to Ms. Nguyen Thi Thu Luong, if a business has a large volume of goods without sufficient invoices and is inspected, they will face penalties under regulations governing the origin of goods. Therefore, businesses should prioritize sourcing from suppliers who provide complete documentation and invoices. Additionally, they should encourage regular partners and customers to change habits, raise awareness, and collectively adhere to tax policies.

Regarding key factors enabling businesses to proactively and confidently engage in electronic filing, Ms. Nguyen Thi Thu Luong noted that the transition from lump-sum tax to filing has been communicated over a specific period, albeit not extensively.

Within 60 days of the policy’s announcement, tax authorities and local governments actively intensified outreach across various platforms, ensuring information reached all businesses.

Moving forward, communication, guidance, and taxpayer support will be further strengthened through close collaboration between tax authorities and local governments, centered around taxpayer needs.

For businesses to proactively and effectively implement the policy, it is crucial to recognize that transitioning from lump-sum tax to filing is mandatory, with no exceptions. Taxpayers, tax authorities, and governments must work together in this process.

Ms. Nguyen Thi Thu Luong stressed that the most critical factor is changing business habits and awareness. With autonomy granted, proactive filing and payment become direct responsibilities of each business. Key policies, information, and outreach content have been fully communicated by tax authorities. During the transition, businesses must clearly understand that tax compliance is a mandatory obligation.

To prepare for electronic filing starting January 1, 2026, businesses should proactively ready themselves mentally, emotionally, and with necessary infrastructure, ensuring confident and proactive policy participation.