Tax authorities and Police join forces to crack down on e-invoice fraud

In 2023 alone, the General Department of Taxation collaborated with the police on numerous fraud cases, referring 88 files for further investigation and possible prosecution.

Meanwhile, law enforcement requested 4,416 taxpayer files from the tax authority to aid in its economic crime investigations. In response, tax officials acted swiftly, providing the necessary records in line with regulatory standards.

This collaboration has yielded significant results, leading to the prosecution of multiple high-profile cases, including a VAT invoice trafficking ring led by Nguyen Minh Tu, an extensive invoice trading network involving Truong Xuan Duoc, and the case against Hoang Dang Ngoc My Trang and her associates, who were charged with “Illegal printing, issuance, and trading of invoices” and “Tax evasion.”

Despite these efforts, tax-related crime is on the rise, with fraudulent schemes becoming more complex and increasingly challenging for authorities to tackle.

One common scheme involves criminals purchasing struggling or soon-to-be-dissolved businesses, then changing the legal representative to sell fraudulent invoices. In another tactic, offenders exploit social media by forming online groups across various platforms to peddle VAT invoices from “ghost companies” selling a range of goods, raking in illegal profits and draining the state budget.

In response to this mounting threat, the tax authority has issued risk assessment criteria for e-invoices under Decision No. 1386/QD-TCT, dated September 26, 2024, while developing advanced IT applications to monitor and analyze e-invoice data. These new tools enable authorities to flag high-risk taxpayers and, where necessary, refer suspicious cases to law enforcement for further investigation.

Alongside these tech initiatives, the tax authority has reinforced regular collaboration with the police and other agencies, including Customs and Banks, to root out those engaged in invoice trading and eliminate any cover-up of illegal invoice use.