Businesses are waiting for VAT refunds

Doanh nghiệp trần ai đợi hoàn thuế VAT - Ảnh 1. — Ms. Le Thi Duyen Hai, Director of the Tax Declaration and Accounting Department (General Department of Taxation), answered questions from business representatives - Photo: TTD

Tax refund problems have arisen over the past three years. Many businesses have been diligently explaining but so far many refund periods have been suspended. Some businesses have taken their tax claims to court.

Hundreds of billions of VND in VAT tax

A representative of Fococev Vietnam Joint Stock Company - a company specializing in exporting cassava flour in District 4, Ho Chi Minh City - raised the company's difficult situation at the conference. This company is waiting for a tax refund of 529 billion VND over the past six years, although the police have not discovered any signs of fraud.

Despite the lawsuit and the first instance verdict and the General Department of Taxation's dispatch, the tax refund process is still prolonged. With capital of just over 100 billion VND, the company faces difficulties when the tax authority requests verification of details such as seal number, bill number, driver information, etc.

"We feel that the tax authorities are only interested in the target of exceeding the budget revenue, while VAT refund is also an indicator that the tax authorities have not paid attention to. We hope that the tax authorities will consider and refund taxes to businesses. If the declaration is incorrect, the business will be held responsible," the business representative requested.

Responding to Fococev's request, Ms. Le Thi Duyen Hai - Director of the Tax Declaration and Accounting Department (General Department of Taxation) - detailed the "fate" why businesses and tax authorities took each other to court.

First, the company reported that the Ho Chi Minh City Tax Department illegally collected VAT (VND 36.7 billion, tax refund period from January 2017 to October 2018). The police also verified but had no basis to determine that the company had illegally exported goods to China, so they requested to return the money to the company.

The tax authority then returned 36 billion VND, and the remaining 700 million VND, once fully reconciled, will be returned to the enterprise.

Second, regarding the amount of VND 127 billion (tax refund period from November 2018 to May 2020), the Ho Chi Minh City People's Court has annulled the tax recovery decision and ordered the company to return the collected amount to the enterprise. However, the Ho Chi Minh City Tax Department has not yet received the official judgment of the court and is consolidating information for appeal.

Third, with the reflection that from June 2020 to now, the tax department has not processed refund dossiers of about 355 billion VND (29 dossiers), 204 billion VND related to sea exports with complete dossiers, while 150 billion VND related to road exports needs additional documents.

Tax refund to give businesses money to operate

Also reflecting on tax refunds, a representative of Saigon PTS Company Limited said that the tax refund application was from April 2021 to June 2022, but the verification process was prolonged even though the company bought and sold legally, had a factory, and paid through the bank. All payment documents were valid, with warehouse and factory delivery notes, customs declarations, etc.

"But because the minerals have not been verified, the company has not received a tax refund. Therefore, the company requests the General Department of Taxation to provide guidance to help the company," the company requested.

The representative of Saigon PTS Company Limited also proposed that refunds not related to risks should be refunded to the enterprise. I hope the tax authority will have specific instructions for the enterprise because currently due to the tax refund congestion, the enterprise is operating very slowly.

In addition, businesses also requested that tax authorities distinguish between businesses established solely to buy and sell invoices and those that had to close due to difficulties. For ghost businesses established solely to buy and sell invoices, tax authorities should have a list for businesses to look up when making transactions.

However, there are real businesses, when the transaction occurs, the business still operates normally, but after the COVID-19 pandemic, the business closed due to difficulties.

So it is clear that the buyer's company is "honest", but when it comes to tax refund, the tax authority checks and finds that the seller's company has closed down, so they immediately block the tax refund application. Many companies have encountered this situation and all of these invoices were rejected, and the company was also fined.

"Our company has been in business for a long time and was classified by the General Department of Taxation as a group that can be refunded first and then inspected, but the local tax authority put us in the group that can be inspected first and then refunded. Is that reasonable or not?", one company was upset.

Good businesses get tax refunds first

Regarding the case of Saigon PTS Company, Mr. Mai Son, Deputy Director General of the General Department of Taxation, requested the Director of the District 1 Tax Department and the leader of the Ho Chi Minh City Tax Department in charge of District 1 to immediately contact the company to resolve the issue.

"We will monitor the results after this conference," Mr. Mai Son affirmed.

Mr. Mai Son said that the General Department of Taxation is developing a regulation to prioritize enterprises with good compliance to be arranged for tax refunds first. That is, enterprises with a long history of import-export activities, whose refund records have been inspected and assessed as highly compliant will have their tax refund procedures carried out faster.