Applying risk management mechanism, applying information technology to tax inspection

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The newly enacted tax inspection process implements administrative reform in tax inspection. Photo: Dong Thuy/VNA

Applying inspection and testing by electronic method

According to the General Department of Taxation, the new process also aims to improve taxpayers' self-discipline to comply with tax laws in the implementation of tax laws; implementing administrative reform in tax inspection, creating favorable conditions for taxpayers to develop production and business of goods and services.

Director of the Department of Inspection and Examination (General Department of Taxation) Vu Manh Cuong said that the new tax inspection process was issued under Decision No. 970/QD-TCT dated July 14, 2023 to replace the tax inspection process promulgated under Decision No. 746/QD-TCT dated April 20, 2015 and amended and supplemented at Decision No. 1215/QD-TCT dated September 3, 2015. Accordingly, the content of the new tax inspection process is built on the basis of inheriting the main contents specified in the decrees and circulars and changing new orders and procedures towards the application of electronic inspection and examination persuant to the provisions of the Tax Administration Law and its guiding documents; other relevant legal documents; organizational structure of the tax sector and the reality of tax administration.

Updating data and information into software and information technology applications for tax inspection is implemented synchronously and continuously to serve tax inspection. Accordingly, the tax inspection department, tax officials assigned the tax inspection task and relevant departments as assigned, are responsible for timely and fully updating information and data of taxpayers into information technology application software for inspection work. At the same time, the tax inspection department and tax officials tasked with tax inspection use the taxpayer's tax declaration data and the taxpayer's information data that has been updated into the data system of the Tax sector to serve the inspection of tax records sent to the tax office. The head of the agency in charge of tax inspection is responsible for regularly grasping and urging the tax examination department and tax officials assigned to perform tax inspection to strictly perform the above tasks with the purpose of well implementing tax management and inspection according to the risk management mechanism in tax administration.

Checking taxpayers under key supervision cases

This process also stipulates the order and procedures for performing tax inspection by tax authorities and tax officials in the following cases: checking tax records at the tax office's headquarters; Tax inspection at the taxpayer's office. Accordingly, the tax inspection at the taxpayer's office shall be carried out in the following cases: inspection according to the provisions of Point c, Clause 4, Article 71 of Circular No. 80/2021/TT-BTC; examine cases with signs of law violations through tax administration as prescribed at Point d, Clause 1, Article 110 of the Law on Tax Administration and other legal regulations; examination for the following cases: dossiers subject to inspection before tax refund; post-tax refund inspection for dossiers which are eligible for pre-tax refund as prescribed (also known as tax refund inspection); examining the cases selected according to the plan, thema decided by the head of the superior tax authority, the thematic examination arising in the year decided by the head of the tax authority at the same level; inspection at the recommendation of the State Auditor, State Inspectorate, other competent agencies, etc.

In particular, Decision No. 970/QD-TCT specifically stipulates the inspection at the headquarters of the tax authority for taxpayers in the case of key supervision. Accordingly, when inspecting at the headquarters of the tax authority according to the provisions of Article 22 of the Circular No. 31/2021/TT-BTC dated May 17, 2021 of the Minister of Finance, providing for the application of risk management in tax administration, the inspection team collects information, documents and data of taxpayers on the tax information system such as documents and records on tax registration, declaration, payment, and reports of used invoices, financial statements, information collected from third parties, etc, in combination with direct tax administration in the area to perform in-depth analysis for taxpayers on the key monitoring list.

According to the tax inspection process, the basic contents of in-depth analysis for key supervisory taxpayers in the case of inspection at the tax office are carried out as follows: analysis and determination of the level of risk according to key monitoring contents; analysis of indicators on financial statements and tax declarations. On the basis of the Financial Statements exploited on the Financial Statements application or the Financial Statements lookup applications (TPH, DWH or other related applications), the tax official who is tasked with checking Tax assessment and analysis basing on the volatility of the criteria on the financial statements according to the regulations on accounting regime promulgated by the Ministry of Finance. Through analyzing the indicators of fluctuations to determine the level of risk to taxpayers, and at the same time, comparing the indicators on the financial statements with those on the tax declarations of the whole year, the tax finalization declarations to compare and evaluate a number of criteria such as: revenue, cost, profit to detect the level of tax risk.