10:18 | 25/11/2013 Finance - Banking
(VEN) - The amended Law on Tax Management which took effect on July 1, 2013 has significantly contributed to simplifying tax procedures to ensure transparency, saving money and time for taxpayers. However, more practical measures must be taken to help businesses overcome difficulties in the process of implementing tax policies.
Under the amended Law on Tax Management, the frequency of making value added tax (VAT) declarations has decreased. Specifically, small and medium-sized businesses now have to make VAT declarations four times a year instead of 12 times in the past. The time required to deal with procedures for extension of the deadline for submitting tax declarations has been reduced from five to three working days. The amended law also simplifies administrative procedures which bankrupt businesses must implement to be absolved from paying debts. Some stipulations on extending the deadline for tax payments have been supplemented to be suitable with the practical situation.
However, the results of a quick survey carried out by the Vietnam Chamber of Commerce and Industry (VCCI) showed that some tax policies which were applied to help businesses overcome difficulties remained unpractical. Tax preferences for small-sized businesses are an example. In fact, many businesses with annual revenue of less than VND20 billion (this is the annual revenue level of a small business) are not offered tax preferences because they have more than 30 employees, exceeding the workforce size of a small business.
When identifying taxes and fees which must be collected from agricultural businesses, tax officials do not yet classify different kinds of land and their uses, leading to the equation of land use taxes applied to different kinds of land and so businesses have to pay taxes at high rates.
A grace period can be offered to help businesses at difficult points of time. But some businesses want more opportunities to enjoy a tax exemption or reduction because businesses have to increase expenses on keeping track of taxes for which they are offered a grace period for payment. This will increase their financial burden for tax payment in the next time. In some cases, the collection of tax arrears still lacks transparency.
Many businesses shared the opinion that tax preferences should be offered to businesses with annual revenue of less than VND20 billion instead of small-sized businesses because in fact, businesses which need support are those which face financial difficulties but not businesses which have a small workforce but high annual revenue.
When repaying taxes, tax authorities should prioritize businesses which seriously abide by tax policies and regulations. The taxation sector must intensify communications and the dissemination of information about businesses which have bought illegal invoices to prevent the use of these invoices.
More favorable conditions must be created for taxpayers to get tax refunds. Online tax declaration and payment must be promoted. Businesses are encouraged to use consulting services during the process of declaring and paying taxes.
Tax policy changes must be widely disseminated among the business community so that they can get ready to deal with new difficulties which may arise during the implementation process./.