Vietnamese businesses can't keep up with rapidly changing tax, customs policies: commerce chamber

By Staff reporters   November 28, 2017 | 09:43 pm PT
Many businesses only learn about the changes after they have already taken effect, leading to heavy penalties.

The Vietnam Chamber of Commerce and Industry (VCCI) has asked the Ministry of Finance to change the way tax and customs authorities review and adjust policies to keep businesses better informed of any changes.

At a dialogue with the ministry on Monday, the VCCI's vice chairman Doan Duy Khuong said many businesses have complained that the ministry's rapidly changing tax and customs policies have left them in the dark. The ministry's circulars on tax guidance are often issued after changes have already taken effect, costing businesses time and effort to adjust related paperwork and creating opportunities for tax officials to exploit.

Businesses have also been complaining about certain VAT regulations such as limitations on refunds that hinder their cash flow.

Additionally, agricultural businesses have found it difficult to complete tax procedures due to the nature of their field. Inconsistencies between tax policies and current accounting practices and complicated personal income tax calculations were also highlighted as problems faced by some businesses.

Businesses have also complained about current regulations regarding late tax payments, with some saying they have been heavily fined for minor, unintentional mistakes. 

While the ministry's decision to launch an e-tax service has been praised, some businesses have found problems with the system. There have been instances of businesses successfully submitting documents but tax officials failing to receive them. Businesses are also still required to print documents and sign them by hand instead of using digital signatures.

Another focus of complaints has been tax inspections, with many businesses finding them unnecessarily long, slow and inappropriate for their intended purpose. Some businesses are only inspected once every 5-10 years, resulting in large penalties for minor, unintentional late payments. In some cases, tax authorities also unnecessarily inspect payments that have already been thoroughly checked in previous inspections.

Regarding customs policies and regulations, businesses also say they suffer from being unable to keep up with rapid changes as the connection between businesses and customs agencies is still limited. When they receive an inquiry, customs officials usually give a generic, vague reply that fails to help.

Many businesses have complained that some customs officials are also unaware of new regulations themselves, or ask for unnecessary documents while conducting administrative procedures. Sometimes customs officials also make excuses or pick on minor mistakes to cause difficulties for businesses, forcing many to offer bribes to get things done faster.

Excessive red tape has also been another source of complaints, with many businesses having to spend weeks obtaining multiple documents just to import a single container of goods.

Based on these complaints and suggestions, Khuong proposed that tax and customs authorities should continue reviewing and adjusting policies and regulations but with a realistic approach that incorporates businesses. All changes need to be widely announced beforehand to give those affected time to prepare.

He also suggested that tax and customs authorities should give step-by-step instructions for administrative procedures so businesses do not find them confusing or difficult to follow. Tax and customs departments should open business support centers to receive and answer queries, as well as offer businesses access to more information.

Khuong said more administrative procedures should be conducted online, and that information should be synchronized to avoid the problems businesses have been encountering with the system.

The VCCI gathers businesses' opinions and suggestions regarding any issues or queries they encounter on a monthly basis. These are then reported to the Prime Minister and tackled by the government's ministers and departments, such as the Ministry of Finance and its tax and customs departments.

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