Tax extension: Enterprises must wait for the Government's official decision

	Tax extension: Only need to be object, no declaration and no damage assessment
	Tax extension: subjects applying for Tax extension do not belong to be extended; they will still be charged late payment interest

Pham Dinh Thi-Director of Tax Policy Department, the Ministry of Finance

Could you tell us about the new contents in the official draft for submission to the Government compared to the draft submitted by the Ministry of Finance for comment on March 10?

Compared to the previous draft, we added subjects enjoying incentives those directly affected by the Covid-19 pandemic, such as education - training, health, activities of art composition, entertainment, sport and play areas.

The other new content is the extension of the deadline for payment of finalised Corporate Income Tax of 2019. According to the Tax Administration Law, enterprises must make final settlement after 90 days from the end of the financial year. Currently, it is the deadline of final settlement of the tax authority. Enterprises must implement tax payment no later than 90 days.

However, after assessment, we thought that to provide direct support for businesses, we proposed to the Government a five-month extension of additional corporate income tax payment according to the final settlement of 2019.

It’s nearly the end of March, many businesses have conducted tax finalisation and corporate income tax payment. If the businesses have paid, do they miss opportunities for incentives?

As I said, under the Tax Administration Law, businesses must pay their taxes no later than 90 days after the end of the fiscal year (March 31).

Currently, according to statistics from local tax departments, the number of businesses submitting settlement documents is very small.

However, we predicted this problem, if the business is subject to a tax extension but already paid tax, it will be deducted from other taxes paid to the State budget.

In the previous draft, the Ministry of Finance expected the support package will be extended about VND 30,100 billion of taxes and land rent. Does the value of the support package change in the official draft?

Because of expanding the subject and extending the corporate income tax payable in 2019, the total extension amount will be more than VND 80 trillion.

The extension will reduce the State budget revenue in the extended months by more than VND 80 trillion but this amount will be remitted by the end of 2020, so it will not affect the budget revenue of the year.

When subjects will be officially enjoyed these incentives and what they should note when asking for an extension?

We propose that this decree takes effect immediately after its promulgation.

Businesses, organisations, individuals and business households must determine exactly whether they are subject to extension or not to apply for an extension to the tax authority. On the basis of the application, the tax authority will make an extension for them.

In addition, this draft proposes extending the corporate income tax finalisation of 2019, as per the Law on Tax Administration, this tax amount must be declared and finalised after 90 days from the end of the year. Therefore, businesses must grasp this requirement and wait for the official decision of the Government, so businesses will be extended for five months.