Digital transformation in the tax sector

	Scaling up for efficiencies in trade facilitation, safety and security
	Focus on reform and digital transformation to facilitate people and businesses

Digitization, digitalization across the entire tax management system

A noteworthy achievement of the Tax sector's digital transformation is its comprehensive shift from paper invoices to electronic invoices (E-invoices), a transition of significant importance and wide-reaching impact on both tax administration and the operations of enterprises. After nearly two years of implementing the nationwide E-invoice system, over 851,000 Vietnamese enterprises and more than 65,000 individual businesses have registered and transitioned to using E-invoices as prescribed.

According to the General Department of Taxation, this adoption of E-invoices has attracted a substantial number of digital technology companies, including 96 organizations providing E-invoice solutions and 25 organizations offering services for receiving, transmitting, and storing E-invoice data, publicly accessible in the Tax sector's electronic information platform. This has ushered in an era of unprecedented growth in the digital economic service sector. To date, more than 5 billion E-invoices have been issued, and 6,618 lucky draw prizes have been awarded to taxpayers.

In addition to E-invoices, the Tax sector has also successfully rolled out an Electronic Information Portal to serve businesses engaged in e-commerce (EC). On March 21, 2022, the General Department of Taxation launched a portal specifically tailored for foreign suppliers who conduct EC activities across international borders but do not have a physical presence within Vietnam. Through this portal, these suppliers can register for taxes, declare taxes, and make direct electronic tax payments.

As of the end of September 2023, 62 foreign suppliers have processed their tax procedures via this portal, including 6 major technology giants: Facebook, Google, Microsoft, TikTok, Netflix, and Apple. The total tax revenue collected from foreign suppliers through this portal exceeds 9 trillion dong. This achievement positions Vietnam among the leading countries in the ASEAN region in implementing taxation for foreign suppliers, affirming the nation's sovereignty in tax management over cross-border digital-based EC activities.

To complete the landscape of public service provision for EC entities, on December 15, 2022, the General Department of Taxation inaugurated an EC Information Portal aimed at supporting EC platforms in transmitting transaction information to the Tax authorities. This system is designed to handle large data volumes using a centralized address for information reception. As of September 2023, 351 EC platforms have submitted information through this portal, including transaction data from more than 34,000 domestic organizations, 136 foreign organizations, 214,000 domestic individuals, and 7 foreign individuals.

Furthermore, in addition to offering level 3 and 4 electronic tax services that have been well-established for many years with impressive statistics, such as 99.8% of enterprises filing electronic tax returns, 98.9% of enterprises making electronic tax payments, and 99.3% of enterprises receiving electronic tax refunds, the Tax sector has also been focusing on expanding its electronic tax services for individuals over the past three years.

To date, there are more than 2.3 million individual electronic tax accounts that can be used for various Tax sector applications, including tax declaration, personal income tax settlement, tax declaration, and payment for rental of assets, as well as declaration and payment of vehicle registration fees for cars and motorcycles.

Advancing the implementation of the tax system reform strategy

According to the General Department of Taxation, the national digital transformation process is robustly taking place across all three pillars: "Digital Government, Digital Economy, and Digital Society." Consequently, the Ministry of Finance and the General Department of Taxation view the electronic invoice platform as a critical factor in advancing all three pillars.

Specifically, it contributes to the Digital Government by enhancing government management, the Digital Economy by facilitating businesses, especially small and medium-sized enterprises, and the Digital Society by benefiting individuals. In the national strategy, the E-invoice platform is considered one of the most pivotal platforms for driving digital transformation. The synchronized digital transformation efforts of the Tax sector are making a substantial contribution to the Ministry of Finance and the Government's overall digital transformation endeavors.

Regarding the benefits that enterprises have gained from implementing E-invoices, Mr. Vo Thanh Dang, General Director of Quang Ngai Sugar Joint Stock Company, pointed out that, particularly during the COVID-19 pandemic, individuals and enterprises greatly appreciate the nationwide digital transformation efforts of the Vietnamese Tax sector, especially the adoption of E-invoices. This transformation has brought significant advantages to businesses.

Specifically, the use of E-invoices has enabled businesses to rapidly engage with customers in terms of exchanging goods and conducting business. Customers receive invoices promptly and conveniently through email, text messages, and websites.

Furthermore, E-invoices have promoted transparent, ethical, open, and equitable business practices, facilitating businesses in managing their invoicing processes for sales, purchases, and tax declarations, resulting in cost savings compared to traditional paper invoices. In the future, businesses hope that the Tax sector will continue to accelerate its digital transformation to enable transparent, equitable operations, thus creating an environment conducive to businesses' financial responsibilities," Mr. Vo Thanh Dang shared.

According to Mai Xuan Thanh, the Director-General of the General Department of Taxation, in the coming period, the Tax sector is aiming to continue comprehensive reforms, digitalization, and digitization, with the goal of providing the highest level of efficient service to individuals and businesses.

The sector will further strengthen the application of modern tax management methods to ensure legal compliance and promote equity in tax compliance. Additionally, the Tax sector will shape the implementation of the Tax System Reform Strategy until 2030, the Action Plan for the Implementation of the Tax System Reform Strategy until 2030, and the Tax System Reform Plan until 2025, all of which have been approved by the Ministry of Finance.