Hanoi Tax Department: Most industries see drop in revenue leading to decrease in arising tax

Covid-19 pandemic continue cause impact on revenue collection of Hanoi City. Photo: Thùy Linh

Most industries have drop in arising tax

According to the Hanoi Tax Department, the State revenue collected in August wasVND 11,877, accumulated in the first eight months, it reached VND 167,187 billion, achieving 64.2% of the ordinance estimate.

Excluding the amount of land fees that must be paid in the first eight months but were extended in accordance with Decree No.41/2020/NĐ-CP, total revenue accumulated in the first eight months of this year would be VND 147,042 billion (reaching 56.5% of ordinance estimate and equal 89.4% over the same period).

Revenue collected from production sector is VND 67,310 billion (reaching 45.9% of current appropriation); collecting fees relating to houses and land is VND 17,517 billion (reaching 65% of current appropriation); collecting from other fees is VND 50,485 billion (reaching 59.7% of current appropriation), mainly caused by the the difference in revenue between income and expenses of bank dropped VND 3,841 billion over the same period the year prior.

According to Mai Son, Director of the Hanoi Tax Department, revenue collected in the first eight months of 2020 fell compared to the same period is mainly due to the impact of the Covid-19 pandemic, which caused declines in revenue and arising tax of most industries.

Along with that, the Hanoi Tax Department has extended the deadline for the payment of tax and land rental in accordance with Decree No. 41/2020/ND-CP with VND 20,145 billion and the difference between the State Bank's income and expenditure in the first eight months of 2020 has decreased by VND 3,840 billion compared to the same period in 2019, so it has caused the reduction in tax revenue of Hanoi Tax Department.

However, the leaders of the Tax Department said from the beginning of the year until now, in the context of the production and business situation impacted by the Covid-19 pandemic, the department closely followed the directives of the city and the Ministry of Finance and the General Department of Taxation for synchronously implementing tasks and solutions to improve the business environment and improve national competitiveness by 2020 as part of Resolution No. 02/NQ-CP dated 1 January, 2020 of the Government to stabilise and develop production for the business community and taxpayers in the area.

“The unit has many solutions in communication to support taxpayers and continue to urge and coerce the recovery of debts and land use levy and land rent debt collection. Strengthening inspection, examination and collection of tax debts, ensure the correct and full collection of taxes, fees, charges and others into State revenue, preventing revenue loss, effectively prevent acts of price transfer, tax fraud, detecting cases of incorrect declaration and insufficient information to correct timely," Son said.

In 2020, revenue is expected to reach VND 232,291 billion

According to the Hanoi Tax Department, if the level of pandemic control is guaranteed as in the current situation, the reduction of State revenue due to the new policy and urging to fully collect the tax amount and land rent that would be extended deadline for payment in accordance with Decree 41/2020/ND-CP in 2020, in case of completing the estimate for collecting land rental (VND 5,000 billion), completing the estimate of land use levy (VND 20,000 billion) but not taking into account the other collection for increasing central revenue collection it is expected the whole year 2020 is estimated to reach VND 232,291 billion, reaching 89.2% of the ordinance estimate, equal to 93.3% compared to 2019.

To perform the task of State revenue collection in 2020 at the highest level, Hanoi Tax Department determined to continue closely following the instructions of the central and city; coordinate closely with local authorities, departments, sectors and central units in tax management; supervise and count the targets and plans assigned to each unit to analyse, evaluate and promptly direct and handle arising problems.

The department will also strengthen the discipline and sense of responsibility in the task performance of tax officials; implement fully, synchronously and effectively the functions, management processes and professional solutions of the sector towards groups of solutions; promote the deployment of e-invoices, administrative reform and application of information technology in intra-industry management and supervision.

Notably, the Hanoi Tax Department has set a target to well implement revenue collection based on following the instructions of the central and the city, updating the Covid-19 pandemic situation to closely assess State revenue collection capacity, drastically implement measures to control revenue, exploit sources of revenue to offset the deficit and strengthen management solutions to combat revenue loss.

It will continue to reform the modernisation of tax administration, support and remove difficulties for taxpayers by accelerating the progress of applying e-invoices, striving to complete before October 1to reach 100% of businesses and organisations using e-invoices in the locality.

The Hanoi Tax Department has also expanded and combated the erosion of the tax agencies based on focusing on the inspection and examination of enterprises operating e-commerce business, enterprises with associated transactions with a large proportion of transfer pricing. For the specialised topic of tax loss prevention in the e-commerce field; strengthen supervision of equity operations and interest costs.

Leaders of the Hanoi Tax Department said they will put maximum efforts, proactively and promptly propose solutions to deploy tasks in the final months of 2020; contributing to the realisation of the goal of accomplishing the socio-economic development tasks of the city as well as the whole country.