Circular No. 6743/BTC-TCDN on handling the write-off of tax debts for state-owned enterprises undergoing transformation

According to the Law on Tax Administration adopted by the National Assembly on November 29, 2006, from July 1, 2007 (the date the Law on Tax Administration takes effect), only enterprises declared bankrupt that have made payments according to bankruptcy laws and still lack assets to pay taxes and fines will be eligible for tax and fine debt write-offs. Therefore, to resolve tax and fine debts for enterprises implementing shareholding reform, transfer, sale as stipulated in Decree No. 187/2004/NĐ-CP dated November 16, 2004 on converting state-owned companies into joint-stock companies, and Decree No. 80/2005/NĐ-CP dated June 22, 2005 on transferring, selling, leasing state-owned companies, the Ministry of Finance requests ministries, provincial people's committees to instruct enterprises eligible for debt write-off under these decrees to coordinate with relevant agencies:

1. Complete the procedures and documents for requesting tax debt write-offs and other budget payments according to Circular No. 32/2002/TT-BTC dated April 10, 2002 of the Ministry of Finance guiding the implementation of Decision No. 172/2001/QĐ-TTg dated November 5, 2001 of the Prime Minister on handling tax debt write-offs and other budget payments for businesses and production and business establishments facing difficulties due to objective reasons, and Circular No. 10945/BTC-TCT dated August 31, 2005 of the Ministry of Finance on tax debt write-offs and other budget payments sent to the Ministry of Finance for consideration and resolution according to regulations.

The subjects for handling are enterprises that undergo restructuring and conversion before the date .

2. In cases where enterprises request tax debt write-offs and other budget payments before conversion after completing shareholding reform, transfer, or sale, they shall be handled as follows:

a) For enterprises that have officially converted into joint-stock companies, only debts and budget payments that were temporarily reduced when determining enterprise value and those arising from the determination of enterprise value until the official conversion into a joint-stock company if production and business operations before conversion incurred losses and lacked payment capacity will be considered for write-off.  Joint-stock companies established from shareholding reforms are responsible for preparing the file

as specified in point 1 of this circular, along with the following documents  - Document requesting tax debt write-offs and other budget payments issued by the competent authority deciding on enterprise value.  as follows:

- Financial statements up to the time of conversion into a joint-stock company.

- Minutes of asset and capital handover from the state-owned company to the joint-stock company, accompanied by detailed accounts of liabilities (for enterprises that have completed handovers).

- Decision approving the enterprise value at the time of official conversion into a joint-stock company by the competent authority.

- Minutes of tax settlement verification from the time of enterprise value determination to the time of conversion into a joint-stock company.

All documents above must be original or certified copies.

b) For enterprises that have completed transfers or sales, only cases where the enterprise's liabilities exceed its asset value or the proceeds from the sale will be considered.

New enterprises established from transferred or sold enterprises are responsible for preparing the file as specified in point 1 of this circular and sending it to the tax authority, along with the following documents:

- Minutes of enterprise value determination.

- Purchase or transfer contracts (specifying the responsibility for handling state budget debts).

- Request document from the local Tax Bureau.

If enterprises have completed shareholding reform, transfer, or sale

3. and in the handover minutes, purchase or sale contracts, or transfer contracts clearly specify the tax debts and other budget payments included in the total capital and assets handed over or clearly define the new enterprise's responsibility to inherit tax obligations and other budget debts of the converted enterprise, then no write-off will be granted (even if losses occur).  During implementation, if there are any issues, please report them to the Ministry of Finance (General Department of Taxation) for research and resolution./.

- Provincial Departments of Finance, Tax Bureaus, centrally administered cities;