Proposal to temporarily suspend exit of business owners with tax debts of 500 million VND or more

ANTD.VN - The Ministry of Finance proposed that from January 1, 2025, 4 cases of tax debt will be temporarily suspended from leaving the country, in which individuals with a debt of 50 million VND or more, and representatives of enterprises with a debt of 500 million VND or more will be banned from leaving the country.

According to the 2019 Tax Administration Law and Decree 126/2020, heads of tax and customs agencies have the right to decide to postpone exit from the country for individuals and business representatives who have not fulfilled their tax obligations.

However, current regulations do not specify a specific debt threshold when applying this enforcement measure. In the past, there have been many cases where temporary exit suspension was applied despite the very small amount of tax debt, causing much controversy.

Recently, the Ministry of Finance has developed and sent to the Ministry of Justice for comments on the draft decree regulating the threshold for temporary suspension of exit for tax debtors.

According to the draft Decree, 4 cases of temporary suspension of exit include: Individual business owners, business household owners with tax debt of 50 million VND or more and the tax debt is overdue for more than 120 days. Thus, compared to the draft in early December (10 million VND).

The second case of temporary suspension of exit is the individual who is the legal representative of a taxpayer who is an enterprise, cooperative, or cooperative union that is subject to compulsory enforcement of an administrative decision on tax management with an outstanding tax amount of VND 500 million or more for more than 120 days. This threshold has also increased 5 times compared to the previous draft (VND 100 million).

Ministry of Finance proposes to apply tax debt threshold to be suspended from exit

In addition, 2 other cases proposed to apply this coercive measure are: Individual business owners, business household owners, individuals who are legal representatives of enterprises, cooperatives, and cooperative unions that are no longer operating at the registered address, still owe taxes and only owe 30 days from the date the tax authority announces that it will apply the measure of temporary suspension of exit;

Vietnamese people leaving the country to settle abroad, Vietnamese people settling abroad, foreigners who owe taxes before leaving Vietnam.

The Ministry of Finance proposes that this regulation will be applied from the beginning of 2025.

According to the Ministry of Finance, the threshold for overdue tax debt that results in temporary suspension of exit as proposed in the draft was proposed after the drafting agency consulted the threshold for tax debt that results in temporary suspension of exit in many countries.

Malaysia sets the threshold for tax debt that results in temporary suspension of exit at MYR 10,000 (equivalent to about USD 2,000). The US applies a tax debt threshold of USD 40,000 to request refusal to issue or revoke passports.

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

Regarding the proposal to select a new application time threshold of over 120 days, according to the Ministry of Finance, to ensure debt collection, increase taxpayer compliance, and avoid long-term debt. At the same time, this regulation can be implemented as soon as the decree is issued because this debt group has been classified for separate monitoring on the tax industry application.

The Ministry of Finance said that currently, there are about 380,000 business individuals and business household owners with tax debts of VND10 million or more and enterprises with tax debts of VND100 million or more; There are about 81,000 business individuals and business household owners with tax debts of VND50 million or more.

Statistics from the Ministry also show that through measures to prohibit and suspend exit from the country for tax debtors, tax authorities have recovered VND4,289 billion in 2024.

Source: https://www.anninhthudo.vn/de-xuat-tam-hoan-xuat-canh-chu-doanh-nghiep-no-thue-tu-500-trieu-dong-post599562.antd