Tax branch implements solutions to secure revenue

It is expected that provincial tax collection of the first quarter, lasting to the second and third quarters would face many difficulties due to the impact of the Covid-19. Many solutions to cope with the decline in State budget revenue are being urgently implemented by Provincial Tax Department to secure revenue.

First tax declaration at Tax Department of Thu Dau Mot City

 Tax revenue is predicted to decline

According to assessment of Provincial Tax Department, the complicated situation of Covid-19 caused many difficulties for the state budget collection in the area. Accordingly, the epidemic has a direct impact on production and business activities of enterprises, business households throughout the province, especially taxpayers operating in fields and industries, such as textiles, leather shoes, wood, transportation, tourism, accommodation, catering, auxiliary services and industries supplying to the above mentioned business activities.

Besides, the closing policy and trade restriction to prevent the spread of epidemic in countries around the world directly affects business and production activities of enterprises. On the other hand, businesses have difficulty in raw materials have to operate moderately and alternately in using laborers to maintain operations and retain workers. Enterprises cannot export goods to other countries for signed orders, and while there are no new orders, thus enterprises cannot take the initiative in making new plans. Moreover, the majority of business households have stopped their operations or operate moderately, due to the implementation of social distancing to limit the spread of epidemic, making the capital recovery be more difficult.

According to Provincial Tax Department, if the epidemic ends in June 2020, the revenue would be affected mainly in the second and third quarter 2020. The estimated revenue deficit in 2020 is nearly VND7,180 billion, down 15.9% compared to the estimate of 2020 assigned by Ministry of Finance and down 16.5% year on year.

Apart from the Covid-19, this year revenue is also affected by the administrative sanctions in road and rail transport system according to Decree 100/2019/ND-CP, reducing the budget revenue by VND368.7 billion, down 0.8% compared to the estimate assigned by Ministry of Finance, down 0.9% year on year, because of the reduced revenue of special consumption tax, added value tax from alcohol and beer production enterprises. “In addition to the elements reducing budget revenue, there are a revenue increase of VND 2,285 billion from land use fees paid in the first quarter 2020 and the whole year's estimate. But in fact, this revenue increase only offset a part of the state budget revenue. Thus, in 2020 it is estimated that the deficit would be nearly VND4,894 billion compared to the assigned estimate", said Nguyen Minh Tam, Director of Provincial Tax Department.

According to Mr. Tam, one of the current worries is that the tax debt by the end of February 2020 of provincial tax is more than VND 2,800 billion, and tax debt in the first quarter of 2020 is likely to increase. In addition, value-added tax in February 2020 of monthly business declaration is due on the monthly 20th date. Currently, the tax authorities are receiving applications for tax payment extension of many large enterprises, which will make new debt increase, while old debts also have not been paid during this time. Therefore, until 10th April 2020 a high debt amount of Q1-2020 was recorded compared to the end of 2019 (VND 2,398 billion).

To proactively carry out solutions

Facing these above difficulties, in order to complete the assigned target and reduce to the lowest loss of state budget revenue caused by the Covid-19, according to Mr. Tam, provincial Tax Department has actively carried out 6 key tasks through 10 solutions. In particular, that is the focus on communication and support taxpayers in all procedures, departments and fields through the renewal of methods and diverse forms of propaganda to support taxpayers; to enhance the application of information technology in tax administration, fulfillment of tax payment obligations, simplification of tax administrative procedures, to maintain good tax declaration, payment, electronic tax refund and electricity invoice services in order to reduce customers' time and people gatherings.

To assign specific collection tasks to each tax branch and office associated with the emulation movement to complete the State budget revenue estimates. Regarding tax declaration and accounting, the tax branch has also improved tax administration quality of taxpayers by speeding up inspection and supervision to avoid violations of Law on Tax Administration;

focus on improving the effectiveness of inspection and examination, ensuring the quantity and quality of enterprise inspection, especially inspecting transfer pricing and preventing losses of non-state revenue. Another equally important solution is to enforce tax debt in cases where it is forced to reduce the debt ratio to less than 5% of total state budget revenue, and then to focus on examining the refund of value added tax. “We all want to contribute to increasing state budget revenue to offset the decline due to the Covid-19, ensuring the fulfillment of the state budget revenue targets set for 2020", said Mr. Tam.

Reported by Thanh Hong - Translated by Ngoc Huynh