81,000 tax debtors are subject to temporary suspension of exit from January 1, 2025.

If the threshold for tax debt overdue over 120 days is applied at 50 million VND for individuals and 100 million VND for businesses from January 1, 2025, about 81,000 people will be subject to temporary suspension of exit from the country.

In the document requesting the Ministry of Justice to soon comment on the draft decree regulating the threshold for applying temporary exit suspension, the Ministry of Finance clearly stated the basis for choosing the tax debt threshold and the tax debt period for which temporary exit suspension is applied.

Regarding the regulation that the amount of overdue tax debt is 50 million VND or more for individuals whose exit is temporarily suspended, the Ministry of Finance said that this tax debt threshold is based on Malaysia's experience of about 2,000 USD/individual, and the US's experience of 40,000 USD/individual (including fines and interest).

Comparing the average income per capita in the US in 2023 of about 80,000 USD, the average income per capita in Vietnam of about 4,284 USD, the threshold for individuals in Vietnam of about 2,100 USD (equivalent to 50 million VND) is appropriate.

Ho Chieu 7 411.jpg — The tax debt threshold applying to temporary exit suspension is expected to take effect from January 1, 2025.

The Ministry of Finance has referred to Taiwan's (China) experience as the threshold for overdue tax debt for businesses - 2 million NT dollars (1.57 billion VND). Many other countries do not have specific thresholds. The Ministry of Finance proposes to apply a debt threshold of 500 million VND - 10 times the amount of overdue tax debt applied to individuals.

Choosing a debt period of over 120 days is to ensure the collection of tax arrears, and at the same time meet the tax management application so that tax authorities can implement it as soon as the decree is issued (because the debt group with a debt period of over 120 days or more has been classified into a separate debt monitoring group).

For taxpayers who are no longer operating at the registered business address but still owe taxes; Vietnamese people leaving the country to settle abroad, Vietnamese people settling abroad and foreigners who have not yet fulfilled their tax obligations before leaving Vietnam, it is necessary to immediately apply the measure of temporarily suspending exit to recover tax debts.

According to statistics on the tax management application system, there are currently about 380,000 individuals who are business individuals, business household owners with tax debts of 10 million VND or more and enterprises with tax debts of 100 million VND or more;

In addition, about 81,000 individuals are business individuals, business household owners with tax debts of 50 million VND or more and enterprises with tax debts of 500 million VND or more; about 40,000 individuals are business individuals, business household owners with tax debts of 100 million VND or more and enterprises with tax debts of 1 billion VND or more.

Thus, when applying the tax debt threshold of 50 million VND for individuals and 100 million VND for businesses, there will be about 81,000 individuals with tax debts who are subject to temporary suspension of exit.

In response to comments on the draft Decree regulating the threshold for temporary exit suspension, announced in early December, the Ministry of Finance unanimously proposed: After the tax debtor completes his/her tax payment obligation, the tax authority shall immediately issue a notice of cancellation of temporary exit suspension to the immigration authority by electronic means. The immigration authority shall cancel the temporary exit suspension within 24 hours from the receipt of this notice.

The Ministry of Finance has proposed a timeframe for this Draft Decree to take effect from January 1, 2025. To ensure this effective time, the Ministry of Finance has drafted the Decree following a simplified procedure.

Revealing the amount of tax collected from more than 23,000 cases of temporary exit suspension

According to data from the General Department of Taxation, since the beginning of the year, there have been an average of 2,374 cases of temporary exit suspension due to tax debts each month. Of the more than 50 trillion VND in tax debts of cases of temporary exit suspension, tax authorities have only collected a small part.