Directive No. 15/2005/CT-TTg on measures to handle overdue debts and prevent revenue losses for the state budget

DIRECTIVE

On Measures to Address Arrears and Prevent Revenue Losses for the State Budget

 State budget revenue in recent years has shown positive changes, with annual collection results exceeding the assigned estimates, the average tax and fee mobilization rate reaching approximately 21% of GDP, contributing to strengthening the country's financial capacity. The achievement of these results is primarily due to relatively strong economic development; adjustments and supplements to tax policies have been implemented and integrated into daily life; the attention and guidance of Party committees, local authorities at all levels, and the coordination among ministries and sectors in tax management; the efforts of businesses, organizations, and individuals to overcome difficulties in production and business operations while fulfilling their obligations to the state budget. There have been significant efforts in publicizing, guiding, and explaining state tax policies and administrative reform, enhancing the effectiveness of tax management work.

 However, the situation of tax, fee, and charge losses remains significant, particularly in the private enterprise sector and high-income individual income tax. Some localities have not adequately managed and exploited resources from land; they have not conducted land use rights auctions. Arrears in tax payments in some localities remain quite high and prolonged, especially in major cities. Coordination between functional agencies and tax management agencies has not been consistent, tight, or proactive in managing state budget revenues.

To strengthen measures to address arrears and prevent revenue losses for the state budget, striving to exceed the state budget revenue targets set forth, creating resources to fulfill important national tasks, the Prime Minister issues the following directive:

1. Ministries, ministerial-level agencies, government-affiliated agencies, and People's Committees at all levels shall organize the implementation of the National Assembly's and the Government's resolutions on annual plan and state budget management measures; promptly resolve difficulties and obstacles for business establishments to achieve the economic growth target; strive to exceed the state budget revenue targets assigned.

2. Ministry of Finance:

a) Develop plans, provide specific guidance, and effectively implement Decision No. 201/2004/QĐ-TTg dated December 6, 2004, of the Prime Minister approving the program to reform the tax system until 2010. Accelerate administrative reform, quickly modernize the tax and customs sectors to serve taxpayers more conveniently, enhance management capabilities, and effectively prevent tax evasion.

b) Direct tax and customs agencies to organize the timely and full collection of taxes, fees, charges, and other revenues into the state budget according to the law; strictly handle cases of arrears and misappropriation of state budget revenues; establish procedures and measures for debt management and recovery; accurately track tax arrears; classify tax debts; analyze the causes clearly and propose appropriate and effective debt recovery measures; study and submit to the Prime Minister measures to deal with unrecoverable tax debts.

c) Coordinate with the Ministry of Public Security, the Ministry of Justice, the Supreme People's Court, the Supreme People's Procuracy, credit institutions, and related agencies to immediately collect into the state budget recoverable arrears during the investigation, prosecution, and trial of cases related to tax matters.

d) Organize specialized units within the tax and customs systems to monitor, urge, and coordinate with competent agencies to enforce the recovery of tax arrears into the state budget.

đ) Take the lead and coordinate with relevant ministries and sectors to develop regulations on information exchange and cooperation with tax management agencies to fully collect arrears and new revenues from enterprises and individuals.

 e) Take the lead and coordinate with the Ministry of Justice, the Ministry of Public Security, and related agencies to develop regulations on forced tax recovery; determine forms, procedures, responsibilities of agencies, and enforcement measures, and submit them to the competent authority for issuance; guide sectors and localities to effectively implement the tax recovery regulations.

g) Strengthen measures to closely control the income and expenses of organizations and individuals subject to taxation, such as:

- Applying economic and technical norms to determine taxable income for entities selling goods without invoices; studying the installation of tax agency cash registers in large supermarkets and retail stores.

- Promptly issue regulations on market price-based valuation methods for associated transactions to prevent the abuse of transfer prices to evade taxes; measures to combat price fraud, especially in industries with comparative advantages; reviewing and assessing the production and business operations of enterprises heavily involved in international and associated transactions to identify transfer pricing risks and plan inspections and audits on transfer pricing.

h) Direct tax and customs agencies to strengthen publicity, information dissemination, and education for taxpayers; provide support services to help organizations and individuals understand tax policies; reduce violations of Tax Law and Customs Law due to lack of knowledge about tax policies; contribute to enhancing self-awareness and compliance with laws among organizations and individuals in self-calculating, declaring, and paying taxes to the state budget. Timely and fully provide tax-related information to media outlets.

i) Strictly manage expenditures of budget beneficiaries, not approve or settle accounts for expenditures lacking valid documentation.

3. The State Bank of Vietnam and relevant ministries and sectors shall coordinate with the Ministry of Finance to implement Point d, Clause 2 mentioned above, and instruct subordinate agencies at localities to cooperate with tax and customs authorities to manage and collect all outstanding debts and related newly-generated revenues from entities required to pay state budget contributions.

4. Ministry of Planning and Investment:

a) Review and study amendments and supplements to conditions and procedures for issuing business registration certificates to detect and promptly prevent the establishment of enterprises for invoice trading and fraudulently appropriating state assets and those of organizations and individuals.

b) Guide and direct provincial Departments of Planning and Investment to cooperate with tax authorities and relevant agencies to strictly manage the operations of enterprises after issuing business registration certificates.

5. The Ministry of Justice shall guide and direct enforcement agencies at all levels in localities to strictly enforce court decisions to recover outstanding debts in the tax sector.

6. The Ministry of Public Security shall direct its units and public security agencies at localities:

a) Closely coordinate with tax and customs authorities and relevant agencies to detect and promptly prevent tax evasion and illegal invoice trading.

b) Promptly investigate and complete case files for cases of tax evasion and fraudulent appropriation of tax revenue.

c) Coordinate with tax and customs authorities, grassroots-level administrative bodies to implement measures to forcibly collect outstanding debts into the state budget.

7. Request the Supreme People's Procuracy and the Supreme People's Court to guide and direct lower-level procuracies and courts to prosecute and adjudicate promptly and strictly cases related to the tax sector that have been transferred by tax and public security agencies.

 8. The General Statistics Office shall direct provincial and centrally-administered city statistical bureaus to provide timely and complete information related to production and business establishments according to the Law on Statistics and guiding documents for the implementation of the Law on Statistics to tax and customs authorities at the same level.

9. Provincial People's Committees under the Central Government:

a) Strengthen the preparation and approval of land use planning, expedite land allocation and lease procedures; formalize land use rights according to the law for areas actually being used by organizations and individuals to have a basis for managing various taxes and charges related to land.

b) Implement land allocation through land use right auctions and land lease auctions to prevent revenue loss from the land sector.

c) Direct financial agencies, tax agencies, and district People's Committees to manage all newly-generated revenues at commune, ward, and town levels; accelerate the delegation of collection of stable business tax, real estate tax, agricultural land use tax, certain fees and charges... to commune, ward, and town People's Committees. Continue to study mechanisms for decentralizing budget revenue sources for local levels according to the State Budget Law, submit to the Provincial People's Council for decision-making in a direction that encourages grassroots-level authorities in economic and social development and links budget expenditure management with budget revenue management in the locality.

d) Direct functional agencies at localities to cooperate with tax and customs authorities to forcibly collect tax arrears, investigate and promptly prosecute and adjudicate cases related to the tax sector.

10. Information and press agencies:

a) Vigorously promote Tax Laws and Customs Law so that all organizations and individuals understand their responsibilities and obligations in paying taxes to the state; sanctions for violating tax policies; have the responsibility to provide information and cooperate with tax and customs authorities to collect taxes.

b) Timely commend organizations and individuals who fulfill their tax obligations to the state budget well; at the same time, strongly criticize those with tax evasion or tax avoidance behavior. Announce on mass media about violators of tax policies or those with large tax arrears according to notifications from tax and customs authorities.

11. Organizations and individuals paying taxes shall be responsible for strictly complying with tax laws, ordinances, and guiding documents in registering, declaring, paying taxes, settling tax accounts, and tax decisions made by tax and customs authorities.

12. The Minister of Finance, the Director-General of the General Department of Taxation, and the Director-General of the General Department of Customs shall be responsible for tax revenue management and strive to prevent situations where enterprises capable of paying taxes fail to fulfill their tax obligations to the state budget.

13. The Ministry of Finance shall report annually to the Prime Minister on the results of implementing this Directive.

14. Ministers, heads of ministerial-level agencies, heads of government-affiliated agencies, and Chairmen of provincial and centrally-administered city People's Committees shall urgently direct and take specific and appropriate measures in organizing the implementation of this Directive.