Speaking at a regular press conference for the third quarter of 2024, held by the Ministry of Finance, Deputy Director General of the General Department of Taxation, Dang Ngoc Minh, addressed the issue of temporary suspension of departure for individuals and legal representatives of enterprises with tax debts. He stated that this matter is governed by the Law on Tax Administration and the Law on Entry, Exit, and Transit.
Mr. Minh clarified that the application of temporary suspension of departure is solely a tax recovery measure and a consequence for enterprises and individuals subject to administrative tax enforcement.
“Prior to any suspension of departure, the individual must be subject to enforcement. It is the responsibility of the legal representatives to fulfill their tax obligations to the state budget,” Mr. Minh emphasized.
Following the previous quarter’s press conference, where concerns regarding departure suspension for tax debtors were raised, the tax industry has implemented multiple channels of communication to warn taxpayers about tax debts.
“The tax authority notifies taxpayers through the eTax Mobile app and text messages. Therefore, it is impossible for businesses or taxpayers to claim ignorance about departure suspension due to tax debts,” said Mr. Dang Ngoc Minh, Deputy Director General of the General Department of Taxation.
According to Mr. Minh, the current process of implementing temporary suspension of departure for individuals and entities with tax debts involves the tax authority conducting a thorough review, comparison, and accurate determination of tax obligations.
“The tax authority managing the taxpayer directly compiles a list of individuals subject to departure suspension and prepares a document to be sent to the exit and entry management agency. Simultaneously, the taxpayer is informed to fulfill their tax obligations before departure,” the Deputy Director-General of the General Tax Department stated.
The leader of the General Department of Taxation emphasized the responsibility of taxpayers to fulfill their tax obligations. The tax authority will consider the most appropriate solutions, prioritizing compliance with legal regulations and ensuring state budget revenue.
According to current legislation, taxpayers with debts exceeding 90 days are subject to enforcement to recover tax arrears into the state budget. If the enforcement decision loses effect and the taxpayer has not paid or has paid insufficient tax arrears, appropriate enforcement measures must be promptly applied in accordance with regulations.
Article 66 of the Law on Tax Administration stipulates: “Taxpayers who are subject to enforcement of administrative decisions on tax management, Vietnamese citizens exiting to reside abroad, overseas Vietnamese, and foreigners must fulfill their tax obligations before exiting Vietnam. In case of failure to fulfill tax obligations, their departure will be temporarily suspended in accordance with the law on exit and entry.”
The law does not specify what constitutes a small or large tax debt. Therefore, regardless of the amount owed, whether it is a few million or billions of dong, if a business is subject to tax enforcement and has not fulfilled its tax obligations, the legal representative will be temporarily suspended from exiting.
According to information from the General Department of Taxation, from 2023 to August 2024, the tax authority has notified 17,952 cases of temporary suspension of departure, involving tax debts totaling VND 30,388 billion.
In 2023, the tax authority notified only 2,411 cases of temporary suspension of departure, with a total tax debt of VND 6,719 billion. Subsequently, on February 6, 2024, the General Department of Taxation issued Document No. 511/TCT-QLN, directing the provincial tax departments to consider applying temporary suspension of departure for recalcitrant tax debtors. This instruction particularly focused on reviewing cases of businesses that had abandoned their business addresses and those suspected of violating tax laws or engaging in illegal invoice trading.
Since then, the provincial tax departments have actively reviewed and applied temporary suspension of departure, significantly increasing the number of business owners affected by this measure in 2024.
The Great Departure Delay: Over 6,500 New Cases of Travel Disruption
“The Ministry of Finance responds to the exit ban on business representatives with tax debts and proposes that e-commerce platforms declare taxes on behalf of sellers. According to the ministry, there have been 6,500 cases of exit bans due to tax debts since the beginning of this year.”
Unlocking Vietnam’s Economic Potential: A $4 Billion Proposal to Reduce Land Rent for Businesses
The two options for reducing land rent in 2024 proposed by the Ministry of Finance are a 15% or 30% reduction. These potential decreases aim to alleviate financial burdens and stimulate economic activity.
The Tax-Debt Dilemma: Unraveling the Mystery of Dong Nai’s High-Profile Tax Delinquents
The top two tax debtors are Tung Lam Limited Liability One-Member Company Limited, with outstanding tax debts of over VND 110 billion, and Phu Hoi Urban Area Joint Stock Company, with tax debts of over VND 81 billion.
