JOINT CIRCULAR NO. 20-TC/TCT GUIDING THE IMPLEMENTATION OF TAX POLICIES FOR BUSINESS OPERATIONS OF UNITS UNDER THE MINISTRY OF HOME AFFAIRS

 CIRCULAR

Guidelines for Implementing Tax Policies on Business Operations of Units under the Ministry of Home Affairs

Based on current tax laws and ordinances;
Considering the characteristics of business operations of units under the Ministry of Home Affairs;
The Ministry of Finance and the Ministry of Home Affairs hereby provide guidelines for implementing turnover tax, special consumption tax, profit tax, and income tax as follows:

I. TAXPAYERS AND TAX PAYING LOCATIONS

1. Taxpayers.

All units under the Ministry of Home Affairs engaged in production, exploitation, construction, transportation, commerce, catering, services, and other business activities shall be subject to all types of taxes as prescribed by law, except for the following cases:

a) Production, repair of weapons, equipment, military uniforms, and supplies, and construction of national defense security projects directly carried out by units under the Ministry of Home Affairs shall not be subject to tax.

In cases where such activities are handed over to organizations or individuals outside the sector for production, processing, or service provision, the receiving entity must pay tax.

b) Production from prisons, rehabilitation centers, workshops, research institutes, experimental stations, and other units under the Ministry of Home Affairs using products produced for self-provision and internal consumption shall be exempt from tax.

If there is product consumption or service supply to the market, they must declare and pay tax on the portion of revenue supplied to the market according to the law, except for agricultural products and food items.

c) Business activities combined with national defense security tasks on key areas (mountainous regions, border areas, sea and island areas) of units facing difficulties and requiring state or Ministry of Home Affairs subsidies to maintain operations shall be eligible for tax reduction or exemption according to Article 18 of the Turnover Tax Law.

d) Research, application, and trial production activities serving assigned tasks and funded by the state budget, where a small number of products or technical services related to research topics are supplied to the market, shall be eligible for tax reduction or exemption on a case-by-case basis by the Ministry of Finance to reduce allocated funds.

For the above cases of tax exemption or reduction, the Ministry of Home Affairs will have specific regulations to manage finances in accordance with the industry's characteristics.

2. Tax Payment Locations.

a) Enterprises, factories, joint enterprises, companies... established by the Council of Ministers and the Ministry of Home Affairs with the mission of producing, repairing, supplying transport, and services to support national defense security tasks, and economic units tasked with combining production and business with strategic area protection.

- Register, declare, and pay turnover tax and special consumption tax (if applicable) for products serving civilian economic activities at the Tax Bureau or local Tax Branch where the business is conducted.

- Pay profit tax and income tax through the Ministry of Home Affairs financial system.

b) Other units (enterprises, companies, holding companies, etc.) not falling under the category mentioned in Point 2-a above must register, declare, and pay all types of taxes at the Tax Bureau or local Tax Branch where production and business activities take place.

II. PROCEDURES FOR PAYMENT, ISSUANCE, AND USE OF COLLECTED TAXES

1. Tax Payment Procedures.

a) For taxes paid to local tax authorities.

- Based on the collection and payment procedures for each type of tax stipulated in tax laws and Circulars guiding the Ministry of Finance, local tax authorities shall instruct production and business entities to timely declare and pay taxes into the treasury. Revenue from taxes collected from production and business entities shall be recorded in the "other revenue" account of the budget (item 47 of other revenue of the central budget) according to the appropriate chapter, type, section, and item of the state budget. This revenue is included in the performance results of tax authorities at all levels.

b) For taxes paid through the Ministry of Home Affairs financial system, it shall be implemented according to the provisions of the Ministry of Home Affairs.

2. Issuance of Tax Refunds.

- Quarterly, based on tax payment receipts (tax payment vouchers, deposit slips into the treasury), production and business units under the Ministry of Home Affairs shall prepare a detailed list of taxes paid, confirmed by the National Treasury and local tax authorities, and send it to the Ministry of Home Affairs. The Ministry of Home Affairs will compile the total amount of taxes paid (along with the tax payment lists and receipts from the units) and submit them to the Ministry of Finance. The Ministry of Finance is responsible for promptly issuing the full amount of these taxes to the Ministry of Home Affairs.

The issuance of tax refunds as described above shall be implemented in 1992.

3. Management and Use of Taxes.

The Ministry of Home Affairs is responsible for using the tax refunds issued in 1992 and the taxes collected through the industry's financial system in accordance with the designated purposes and contents of the budget. Each year, the Ministry of Home Affairs is responsible for finalizing the settlement of taxes collected with the state.

III. IMPLEMENTATION

1. The Ministry of Finance and the Ministry of Home Affairs are responsible for ensuring that units and agencies under their jurisdiction understand the content of this Circular.

Production and business units under the Ministry of Home Affairs must promptly and strictly comply with state regulations on business registration, tax declaration, opening and recording accounting books according to the Accounting and Statistics Ordinance. Agencies of both ministries are responsible for guiding production and business units under the Ministry of Home Affairs to implement the content of this Circular correctly.

2. The Ministry of Home Affairs and the Ministry of Finance shall unify the list of units under the production and business model required to pay various types of taxes as specified in point a, section 2, part I of this Circular and notify localities to implement.

To ensure security confidentiality, units listed in section 2 above only have the responsibility to register and explain to local tax authorities two indicators:

- Product categories and quantities of economic products.

- Revenue from service activities and economic products sold to the market.

In addition to regular inspections for tax management, if the tax authority needs to audit units listed in point 2a of part I above, they must obtain agreement between the Ministries of Home Affairs and Finance and involve representatives from the Ministry of Home Affairs. The Ministry of Home Affairs will inform the audited unit, which has the responsibility to strictly comply with the requirements and assist the audit team in completing their tasks.

3.- For types of taxes and other revenues not mentioned in this Circular, they shall be implemented in accordance with the current regulations of the State and the guidance of the Ministry of Finance.

4.- This Circular takes effect from January 1, 1992. All previous provisions of the Ministry of Interior and the Ministry of Finance that conflict with this Circular are hereby abolished. In the course of implementation, if there are any difficulties, units and tax authorities are requested to report them promptly for the two Ministries to study and resolve.