Binh Dinh Customs effectively implements debt freezing and writing-off

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Officials of the Technical Division, Binh Dinh Customs Department discussed tax work

Main tasks

According to the leader of Binh Dinh Customs Department, the collection and handling of tax debts is one of the key tasks of the Customs sector. Based on tax legal documents, the General Department of Customs regularly follows the situation, issues documents to direct and guide, and solves the problems of the local customs department to implement tax debt handling effectively. At Binh Dinh Customs Department, most of them are bad debts of long-standing debtors. In which, most of the debts arose before July 1, 2013.

As of June 30, 2023, Binh Dinh Customs has frozen and written off more than VND13 billion of tax debts. In which, the principal amount is over VND11.5 billion; the late payment amount is over VND1.5 billion and the administrative fine is VND5 million.

Among the settled tax debts, the debts of taxpayers who have filed a request to initiate bankruptcy proceedings or have been requested by persons with related rights and obligations to initiate bankruptcy proceedings in accordance with the law on bankruptcy, are amounted to more than VND140 million;

The debts of taxpayers no longer operate at the business address registered with the business registration authority which is confirmed by the local tax agency in accordance with the People’s Committee of the commune, ward, and town are nearly VND100 billion.

The debts of taxpayers who have been requested in writing by the tax authority to revoke the business registration certificate, enterprise registration certificate, cooperative registration certificate, business household registration certificate, establishment and operation license, or work practice certificate are VND11.3 billion.

Remove difficulties from Resolution 94

On November 26, 2019, the 14th National Assembly approved Resolution No. 94/2019/QH14 (referred to as Resolution 94) providing for tax debt freezing, debt cancellation of late payment fines, and late payment interest for taxpayers who are no longer able to pay the state budget. Resolution 94 takes effect from July 1, 2020 (effective within three years).

Since Resolution 94 took effect, Binh Dinh Customs Department has directed its attached Customs Branches to seriously research the contents and implement debt settlement according to the provisions of Resolution No. 94 and Circular No. 69/2020/TT-BTC (Circular 69) of the Ministry of Finance and guiding documents of the Ministry of Finance and the General Department of Customs; the unit has issued documents directing, urging the collection and handling of tax debt; promptly organize meetings to exchange and discuss internally to reach consensus on understanding, solving problems and the implementation.

At the same time, the unit disseminated the contents of Resolution No. 94 and Circular 69 to the business community through an annual business dialogue conference.

At the end of 2022, the inspection team of the Ministry of Finance inspected debt settlement according to Resolution No. 94 and Circular No. 69 at the Customs Department of Binh Dinh province, the team highly appreciated and recorded the results that the unit achieved in the debt settlement.

For the frozen tax debts, as of June 30, 2023, the affiliated branches issued 8 decisions on debt freezing under Resolution 94 for 24 enterprises with an amount of over VND 11.5 billion;

In addition, affiliated branches issued 4 decisions on debt freezing under Article 83 of the Law on Tax Administration No. 38/2019/QH14 for 4 enterprises with a total amount of over VND 4.8 billion, bringing the total amount of frozen tax debt to over VND 16.4 billion.

In order to freeze debt to the right subjects, the branches actively implemented enforcement measures suitable to each enterprise, and verify the operation status of enterprises at relevant agencies, such as the Department of Planning and Investment, the Department of Taxation, the Public Security and local authorities, thereby completing procedures and considering enterprises eligible for debt forgiveness.

Binh Dinh Customs Department appraised and submitted to the provincial People's Committee 8 applications for debt cancellation of late payment interest and late payment fine for 18 enterprises. The provincial People's Committee issued decisions on debt cancellation for these 18 enterprises with a total amount of over VND 1.5 billion.

Binh Dinh Customs Department and its affiliated branches have worked well with relevant units and agencies in providing and exchanging information on the operation of enterprises. The customs authorities provided information on debt freezing and debt cancellation for the Department of Planning and Investment to monitor; help provide relevant documents in the implementation of tax debt writing off according to Resolution 94 to the Department of Justice of Binh Dinh province, the Office of the People's Committee of Binh Dinh province to advise the People's Committee of Binh Dinh province to consider and write off the debt.

The issuance of Resolution 94 has met practical requirements and had important implications in tax administration and handling of bad tax arrears taxes. At Binh Dinh Customs Department, most of the outstanding debts before July 1, 2013, belong to the debts of enterprises that were dissolved, applied for opening bankruptcy procedures, ceased operations, left business addresses, etc, and are no longer be collected, creating great pressure in tax administration.

Binh Dinh Customs is facing many difficulties in budget collection

Resolution 94, which was issued for 3 years (from July 1, 2020, to June 30, 2023) has helped remove the difficulties in handling bad debts and closely assess the current status of tax debts to have effective measures to collect receivable debts, helping reduce pressure in tax debt management. Binh Dinh Customs Department requests the branches to continue monitoring and grasping information about businesses whose tax debts are frozen or canceled so that in case these enterprises return to operation, the customs will cancel the decisions and implement appropriate coercive measures to recover tax debts in accordance with regulations.