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In recent years, Hanoi Tax Department has always exceeded the budget revenue estimate. Photo Thuy Linh.

Hanoi Tax Department’s revenue always grows compared to the national average

Assessing the implementation of the Law on Tax Administration in Hanoi City at the Voter Meeting of Hanoi National Assembly delegation on the theme: Current status of tax management in Hanoi and recommendations and solutions to implement law on tax administration in the coming time. Commenting on major contents in the revised Law on Tax Administration, held on May 14, Director of Hanoi Tax Department Mai Son said that over 10 years of implementing the Law on Tax Administration, the tax collection and tax administration has gained achievements and revenues have been strictly managed and administration apparatus has been constantly improved.

"In recent years, Hanoi Tax Department has always exceeded the budget revenue estimate. As a result, domestic revenue for the 2009-2018 period reached more than VND 1,400,000 billion, the revenues over the years increased and surpassed the estimate "said Mai Son.

According to Chairman of Vietnam Tax Consultants Association Nguyen Thi Cuc, Hanoi is one of the major centers in terms of budget collection; its revenue has increased many times compared to the national average. In 10 years, the Hanoi Tax Department's revenue grew by 35%, while the annual average of the whole country was only 19%.

Hanoi Tax Department is one of the leading units in applying information technology and developing the tax system.

According to Deputy Director of Ernst & Young Vietnam Limited Company Huong Vu, Hanoi Tax Department manages many large and small enterprises and foreign-invested enterprises. If compared to other units, the Department's hotline is really "hot" 24/7. The comments have been received fully, removing difficulties for enterprises in many cases.

Huong Vu appreciated the Hanoi Tax Department’s efforts to facilitate taxpayers.

The law often follows the reality

Huong Vu said that in recent years, the Law on Tax Administration has been revised up to 3 times but so far, it is still amended because the law is "going after the reality”, especially for e-commerce tax.

She said that the revised Law on Tax Administration has proposed that banks have the duty to deduct or fulfil tax obligations for foreign organizations and individuals having e-commerce business activities and income from Vietnam. This proposal sounds easy but is difficult to implement.

"This is the first time that such a proposal has been included in the law, but the difficulty is that bank officers do not have sufficient knowledge of tax to implement the tax deduction. The policy makers should also carefully consider to introduce a reasonable deduction rate”, said Vu

Vu said if the deduction rate is implemented in accordance with the draft Law on Tax Administration, the decree and the circular must provide specific regulations. This is to avoid commercial banks making it difficult for investors.

As for the content "commercial banks are responsible for providing information on account numbers according to tax codes of taxpayers when opening accounts" in the draft, Assoc. Prof. Dr. Le Xuan Truong, Dean of Tax Department and Customs, Academy of Finance questioned if the above regulation means that banks are not responsible for providing payment transactions?

Truong said that it is necessary to ensure confidentiality with customers of commercial banks but also notes the scope of confidentiality. According to Truong, the bank can provide information for suspicious transactions.

Cuc admitted that the current management of e-commerce is not good. For example, the tax authorities tried to classify different forms of transactions such as selling on social networks, on television, individuals providing services for Youtube and Google, but the tax revenue was not significant. The reason is that the tax authorities have not managed the cash flow and do not capture banking transactions.

Currently, the bank only provides tax authorities with cases of violations and tax evasion. For other accounts, the tax authorities do not understand even though these accounts can receive tens of thousands dong from Google, Youtube.

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She recommended that there should be a mechanism to share information between credit institutions and tax authorities but still ensure confidentiality with taxpayers. This alone cannot be done by the Taxation sector but must require coordination with competent units such as network security agencies, Ministry of Public Security, credit institutions to build a database to grasp Taxpayer’s information.