Thông tư 31/2021/TT-BTC quy định về áp dụng quản lý rủi ro trong quản lý thuế do Bộ trưởng Bộ Tài chính ban hành

MINISTRY OF FINANCE ----------	SOCIALIST REPUBLIC OF VIET NAM Independence-Freedom-Happiness -----------------
No.: 31/2021/TT-BTC	Hanoi, May 17, 2021

 

CIRCULAR

PRESCRIBING APPLICATION OF RISK MANAGEMENT TO TAX ADMINISTRATION

Pursuant to the Law on Tax Administration dated June 13, 2019;

Pursuant to the Government’s Decree No. 126/2020/ND-CP dated October 19, 2020 on elaboration of the Law on Tax Administration;

Pursuant to the Government’s Decree No. 87/2017/ND-CP dated July 26, 2017 defining functions, tasks, powers and organizational structure of the Ministry of Finance;

At the request of Director of the General Department of Taxation,

The Minister of Finance promulgates a Circular prescribing the application of risk management to tax administration.

Chapter I

GENERAL PROVISIONS

Article 1. Scope

This Circular introduces regulations on application of risk management to tax administration by tax authorities at all levels, including:

1. Collection, processing, management and use of information related to taxpayers to serve risk management.

2. Assessment of the compliance with tax laws and classification of taxpayer risks.

3. Application of tax administration measures corresponding to levels of compliance with tax laws and levels of taxpayer risks.

Article 2. Regulated entities

1. Taxpayers.

2. Tax authorities.

3. Tax officials.

4. Relevant regulatory authorities, organizations and individuals as prescribed in Article 2 of the Law on Tax Administration.

Article 3. Definitions

1. “application of risk management to tax administration” means the employment of risk management procedures, rules, measures and/or techniques and results of assessment of compliance with tax laws and levels of taxpayer risks to decide the implementation of tax administration measures.

2. “risk management information” means information about and related to tax which is collected and processed to serve the application of risk management to tax administration.

3. “compliance level” means the classification result of a taxpayer’s compliance with tax laws given by a competent tax authority.

4. “compliance assessment criteria” mean the standards used for assessing taxpayers’ compliance with tax laws.

5. “compliance assessment indicators” mean information criteria with specific values included in compliance assessment criteria.

6. “compliance assessment” means the collection, analysis, verification and comparison of information about business operations and compliance with tax laws with compliance assessment criteria and indicators for classifying taxpayers’ levels of compliance with tax laws.

7. “compliance management” means tax authorities’ compliance assessment, classification of risks, and analysis of taxpayers’ behaviors whereby they will use appropriate resources for management measures for each level in order to encourage the voluntary compliance and prevent non-compliant behaviors.

8. “analysis of taxpayer risk” means the analysis of information about a taxpayer so as to detect signs of violations against tax laws which cause loss of state budget revenues from taxes.

9. “level of risk” means the severity of the risk which is determined based on both frequency and consequence of that risk.

10. “risk classification criteria” mean the standards used for assessing and determining the levels of risks in tax administration.

11. “risk classification indicators” mean information criteria with specific values included in risk classification criteria.

12. “risk assessment” means the classification, consideration and comparison of levels of risks with risk classification indicators and treatment of previous risks in order to determine the order of priority.

13. “signs of risk” mean any information reflecting potential violations against laws.

14. “signs of tax-related violation” mean any information used for identifying violations against tax laws.

15. “emphasized supervision" means tax authorities’ application of professional measures against taxpayers that are assessed to pose high risks or that are non-compliant with tax laws in each business sector and each area in each period.

16. “risk management application” means an information technology application which is used for connecting and receiving information from relevant data sources within and outside tax authorities, and digitalizing risk management measures and techniques based on the issued criteria and indicators so as to carry out the analysis of taxpayer risks, compliance assessment, and determination of levels of risks which are used by tax authorities to decide the implementation of professional measures.

17. “taxpayer segmentation” means tax authorities’ classification of taxpayers into specific groups with the same characteristics to which appropriate management measures are applied.

18. “classification using machine learning” means the conduct of computational and statistical algorithms on computers to determine models, functions and indicators used for classifying and estimating levels of risks.

19. “list-based ranking” means a method employed to assess taxpayers by comparing with criteria and indicators on their business operations and compliance with tax laws, and arranging them into groups corresponding to each rank. Taxpayers shall be ranked according to their satisfaction of criteria, indicators of criteria, and indicators of corresponding ranks.

20. “scoring and score-based classification” means a method employed to assess taxpayers based on scores of criteria and indicators on their business operations and compliance with tax laws.

Article 4. Risk management rules

1. The application of risk management is aimed to ensure the validity and efficiency of tax administration activities; encourage and facilitate taxpayers’ voluntary compliance with regulations and laws on taxation and tax administration as well as prevent, detect and promptly take actions against regulations and laws on taxation and tax administration.

2. Risk management information is collected from information sources within and outside tax authorities (including foreign information sources) in accordance with regulations of law; is mainly managed at the General Department of Taxation through the information technology system and shall be processed, shared and provided for tax authorities at all levels and other regulatory authorities to serve their performance of tax administration tasks in accordance with regulations of law.

3. Assessment and classification of taxpayers’ compliance and risks shall be automatically and periodically carried out adopting one or some of the methods specified herein in accordance with regulations of law, tax administration procedures and measures, and based on the taxpayer segmentation and criteria specified herein and taxpayer database.

4. Based on results of compliance assessment, classification of taxpayer risks, information available on tax administration applications of tax authorities, signs of violations, and other signs of risks available at the decision-making time, tax authorities shall:

a) Issue decisions on tax inspection, audit or supervision, or application of professional measures.

b) Develop plans for comprehensively improving the compliance which are suitable for resources of tax authorities based on results of analysis of nature, causes and incidence of each level of compliance or each level of risk.

5. In case of strict compliance with regulations of law, regulations herein and relevant guidelines on risk management, tax officials are exempt from personal liability in accordance with regulations of law.

6. If the risk management application malfunctions or has not yet met risk management requirements laid down herein, the application of risk management shall be carried out in a manual manner that competent authorities shall consider approving proposals or issuing documents on application of tax administration measures in accordance with the Law on tax administration and its guiding documents.

7. If there are changes in results of compliance assessment and classification of taxpayer risks due to changes in information which are not yet automatically updated on the risk management application, such changes shall be manually updated by tax officials after obtaining approval from competent authorities.

8. Implementation results of professional measures for levels of risks must be fully and accurately updated on tax administration applications of tax authorities or the risk management application on a case-by-case basis so as to serve the improvement and conduct of compliance assessment and classification of taxpayer risks in following periods.

Article 5. Methods for compliance assessment and classification of taxpayer risks

Levels of compliance and taxpayer risks shall be determined adopting one or some of the following methods:

1. Scoring and score-based classification.

2. Machine learning.

3. List-based ranking.

Article 6. Procedures for applying risk management

Tax authorities shall apply risk management to tax administration according to the following procedures:

1. Assess the situation, and determine risk management objectives and requirements

Tax authorities shall review risks and faults of taxpayers during their compliance with provisions in Article 17 of the Law on Tax Administration No. 38/2019/QH14 or regulations in force in order to identify major risks need to be treated as well as high-risk taxpayers and treatment solutions thereof.

2. Organize the collection and processing of risk management information

Risk management information is collected and processed according to regulations in Chapter II hereof.

During the analysis of taxpayer risks, if any information is found to be false or inadequate, taxpayers shall provide explanations or additional information and documents as requested and within the time limit notified by tax authorities to ensure the accurate compliance assessment and classification of taxpayer risks.

3. Establish and update indicators serving the analysis, compliance assessment and classification of taxpayer risks

Based on results of assessment of situations and determination of risk management objectives and requirements as prescribed in Clause 1 of this Article, risk management information and information technology applications, tax authorities shall establish and update indicators and weighing factors used for assessing and classifying the levels of compliance and taxpayer risks.

4. Carry out analysis and compliance assessment; determine levels of taxpayer risks; determine levels of risks from tax administration operations; manage risk records of emphasized supervision cases

Taxpayers are segmented according to conditions which are appropriate for tax administration requirements in each period when carrying out analysis and assessment of compliance and taxpayer risks.

The analysis and classification of compliance and taxpayer risks shall be carried out using the methods specified in Article 5 hereof.

5. Based on results of risk classification and compliance assessment, apply tax administration measures and develop plans for comprehensively improving taxpayers’ compliance.

6. Monitor, update and assess feedbacks on implemented tax administration measures.

7. Collect, process, use and retain information; provide guidance on adjustment of risk management so as to ensure the efficiency of tax administration activities.

Chapter II

COLLECTION AND PROCESSING OF RISK MANAGEMENT INFORMATION

Article 7. Risk management information

Information serving risk management in tax administration operations includes:

1. Information of tax authorities

a) Information about business registration and tax registration; information about identity of founding members, owners and legal representatives of taxpayers; registration and use of employees; information about taxpayers’ status; number of times of changes in business registration and tax registration information; capital contribution by members; main business lines;

b) Information about tax declaration dossiers; tax payments; tax arrears; tax incentives, tax exemption and reduction; tax deferral; tax refund; registration, management and use of invoices and records; information about complaints and denunciations; information about inspection results and post-inspection actions; information about transfer pricing;

c) Other information.

2. Information provided by relevant regulatory authorities, organizations and individuals

a) Information about taxpayers collected provided by relevant regulatory authorities, organizations and individuals as prescribed in Article 26, Article 27, Article 30 of the Government’s Decree No. 126/2020/ND-CP dated October 19, 2020;

b) Information from foreign sources or provided by international organizations to fulfill their obligations under relevant international treaties on taxation to which Vietnam is a signatory.

3. Other information relevant to taxpayers.

Article 8. Collection and processing of risk management information

1. Sources of information to be collected

a) Information from information systems of tax authorities;

b) Information obtained during the cooperation with agencies and units affiliated to the Ministry of Finance, and those affiliated to relevant Ministries on sharing and provision of information serving the performance of tax administration tasks;

c) Information obtained during the cooperation and information sharing with foreign tax authorities and competent authorities in accordance with regulations of law;

d) Information provided by regulatory authorities, relevant organizations and individuals in accordance with regulations of law;

dd) Information on taxpayers’ operations collected during the performance of tax administration activities;

e) Information purchased according to the Law on tax administration and its guiding documents;

g) Tax-related information from foreign sources or provided by international organizations to fulfill their obligations under relevant international treaties to which Vietnam is a signatory;

h) Information from other sources as prescribed by law.

2. Forms of information collection

a) Information is provided or exchanged in soft copy format, electronic documents, e-mail or through the web portal of General Department of Taxation; by sending messages and making calls to the telephone numbers officially announced by tax authorities;

b) Information is provided or exchanged in writing, by telegram, fax or paper documents;

c) Information is exchanged directly with written records made and bearing certification of relevant parties; information is collected by representatives; from meetings and in other forms.

3. Processing of collected information

a) Assess the relevance of the collected information to the needs and purposes of information; consider the trustworthiness and accuracy of information;

b) Arrange and retain information by sorting it into specific categories to serve the use and analysis of information;

c) Carry out analysis of information to identify components of risk management information;

d) Consolidate relevant components which are identified through the said analysis to clarify the importance of the collected information to the determination of levels of risks and compliance assessment.

Article 9. Application of information technology to risk management

1. The risk management application and taxpayer database are developed and managed by the General Department of Taxation in a manner ensuring that information used for risk assessment shall be fully, accurately and promptly updated by connecting to electronic tax data processing systems and relevant information systems.

In case the systems encounter connection errors, information shall be updated, integrated, processed and retained on the systems immediately after such errors are remedied.

2. Management measures shall be adopted to ensure data safety and confidentiality, computer safety and cybersecurty in accordance with regulations of law.

3. The General Department of Taxation shall stipulate responsibilities of tax authorities and tax officials to develop, manage, operate, update and use the risk management application appropriate for tax operations.

Chapter III

COMPLIANCE ASSESSMENT AND CLASSIFICATION OF TAXPAYER RISKS IN TAX ADMINISTRATION

Article 10. Compliance assessment

1. Taxpayers shall be assessed and classified into one of the following levels of compliance with tax laws:

a) Level 1: High compliance.

b) Level 2: Medium compliance.

c) Level 3: Low compliance.

d) Level 4: Non-compliance.

2. Levels of compliance by taxpayers are classified according to the criteria specified in Appendix I enclosed herewith.

3. Tax authorities shall monitor and process compliance assessment results as follows:

a) Taxpayers that are non-compliant shall be managed according to the provisions in Article 22 hereof;

b) Behaviors of high-, medium-, low- and non-compliance taxpayers shall be analyzed to adopt appropriate measures for improving the compliance.

Article 11. Classification of levels of risks of taxpayers that are enterprises

1. Overall risk classification

a) Taxpayers that are enterprises are classified into one of the following levels of risks:

a.1) Level 1: Very-low risk.

a.2) Level 2: Low risk.

a.3) Level 3: Medium risk.

a.4) Level 4: High risk.

a.5) Level 5: Very-high risk.

b) Taxpayer risks shall be classified according to the compliance assessment results prescribed in Article 10 and the criteria in Appendix II enclosed herewith.

c) Handling results of classification of risks of taxpayers that are enterprises

c.1) Taxpayers of very-high or high level of risk shall be managed according to the provisions in Article 22 hereof;

c.2) Depending on tax administration requirements in each period, taxpayers of various levels of risks may be further subjected to risk classification in tax administration operations as prescribed in Clause 2 of this Article.

2. Risk classification in tax administration operations

a) Levels of risks of taxpayers that are enterprises in tax administration operations include:

a.1) High risk.

a.2) Medium risk.

a.3) Low risk.

b) Taxpayer risks in tax administration operations shall be classified according to the overall risk classification results prescribed in Clause 1 of this Article and the criteria in Appendix II enclosed herewith.

c) Handling risk classification results

Taxpayers of levels of risks shall be liable to tax administration measures in each tax administration operation prescribed in Chapter IV hereof.

Article 12. Classification of levels of risks of taxpayers that are individuals

1. Taxpayers that are individuals are classified into one of the following levels of risks:

a) High risk.

b) Medium risk.

c) Low risk.

2. Levels of risks of taxpayers that are individuals shall be classified according to the compliance assessment results prescribed in Article 10 and the criteria in Appendix III enclosed herewith.

3. Handling results of classification of risks of taxpayers that are individuals

Taxpayers of levels of risks shall be liable to the tax administration measures specified in Article 15 hereof.

Chapter IV

APPLICATION OF RISK MANAGEMENT TO TAX ADMINISTRATION

Article 13. Application of risk management to tax administration

1. Based on the compliance assessment results prescribed in Article 10, results of classification of taxpayer risks prescribed in Article 11 and Article 12 hereof, and professional information available at the decision-making time, tax authorities shall make the list of taxpayers classified into levels of risks in each period and:

a) Manage the compliance with tax laws;

b) Manage risks associated with tax registration;

c) Manage risks in inspecting tax declaration dossiers at tax authorities;

d) Manage risks in managing tax refunds;

dd) Manage risks in carrying out inspection and audit at the premises of the taxpayers;

e) Manage risks in managing tax debts and implementing tax enforcement decisions;

g) Managing risks in managing invoices and records;

h) Manage risks of taxpayers subject to emphasized supervision;

i) Manage risks of taxpayers that are individuals;

k) Apply risk management to other tax administration operations.

2. The list of risky taxpayers sorted by cases specified in Clause 1 of this Article shall be updated on the risk management application. Tax authorities at all levels shall consolidate, update and manage information about risky taxpayers to serve the performance of tax administration tasks within the whole tax sector.

3. The General Department of Taxation shall stipulate the periodical assessment and compilation of the list of risky taxpayers sorted by cases specified in Clause 1 of this Article for determining important issues in tax administration to meet tax administration requirements in each period.

4. In case any suspicious information or signs of violations against tax laws are detected during tax inspection or tax audit or according to denunciations or notifications from regulatory authorities, investigating authorities, heads of tax authorities shall decide to change the method and scope of tax inspection or tax administration measures within their competence and shall also assume responsibility for their decisions.

Article 14. Measures for improving compliance levels

Based on the compliance assessment results prescribed in Article 10 hereof, tax authorities shall carry out analysis of the nature and incidence of each compliance level of taxpayers, and develop specific plans for improving the compliance with specific measures for each compliance level as follows:

1. For high-compliance taxpayers: put them into the list of taxpayers being considered for commendation and reward.

2. For taxpayers need to improve their compliance:

a) Cooperate with relevant authorities and organizations, tax agents to implement measures for assisting taxpayers with completion of tax procedures; organize programs to meet taxpayers, meetings, seminars and training courses to assist taxpayers with fulfillment of their tax obligations;

b) Propose amendments to policies, simplification of administration procedures, adoption of assistance measures, and application of information technology to facilitate taxpayers’ declaration and payment of taxes and minimize costs of compliance;

c) Classify risks and apply tax administration measures according to levels of taxpayer risks as prescribed in Articles 15 through 22 hereof.

Article 15: Management of risks of taxpayers that are individuals

Based on the list of individual taxpayers that are classified into levels of risks as prescribed in Article 13 hereof, tax authorities shall decide to adopt appropriate tax administration measures as prescribed.

1. For household businesses and individual businesses

a) High risk: One or some of the following measures shall be implemented:

a.1) Review, check and verify relevant information used for re-determining revenues and tax rates of household businesses and individual businesses;

a.2) Make list of household businesses and individual businesses to be inspected or surveyed for re-determining their revenues and tax rates, and assessing fulfillment of tax obligations by relevant organizations.

b) Medium risk: Randomly select household businesses and individual businesses for surveys; continue carrying out classification of risks to serve the following assessment period;

c) Low risk: Keep records and carry out classification of risks to serve the following assessment period.

2. For individuals earning incomes which are subject to personal income tax (excluding household businesses and individual businesses)

a) High risk: Make the list of individuals subject to verification visit and organize verification visit according to regulations in force;

b) Medium and low risks: Keep records and carry out classification of risks to serve the following assessment period.

Individuals that earn incomes subject to personal income tax from income payers shall be controlled by means of analysis of signs of risks of such income payers.

3. For individuals earning revenues from land and property on land

a) High risk: Carry out analysis of documents, make and submit the list of individuals whose tax declaration dossiers are inspected at tax authorities to heads of the tax authorities, and carry out inspection of tax declaration dossiers at tax authorities in accordance with regulations in force;

b) Medium and low risks: Keep records and carry out classification of risks to serve the following assessment period.

Article 16. Application of risk management to tax registration management

Based on the list of taxpayers classified into levels of risks associated with tax registration as prescribed in Article 13 hereof, tax authorities shall adopt appropriate handling measures or cooperate with business registration authorities in handling in accordance with regulations of laws on business registration and tax registration.

1. In case of change of a taxpayer’s tax registration information resulting in change of the supervisory tax authority:

a) High risk: The tax authority in charge of the old location shall cooperate with the tax authority in charge of the new location to carry out inspection at the tax authority or carry out inspection or audit at the premises of the taxpayer in accordance with regulations of law in force;

b) Medium risk: The tax authority in charge of the new location shall place the taxpayer under supervision and request the taxpayer to provide explanations and documents if necessary;

c) Low risk: Inspection and supervision are not necessary; tax authorities shall carry out compliance assessment and classification of risks to serve the following assessment period.

2. In case of a taxpayer’s business suspension

a) High risk: Intensify tax administration measures which must be commensurate with the taxpayer’s fulfillment of tax obligations so as to take actions against tax debts, invoices and violations (if any) in a timely manner;

b) Medium and low risks: Implement tax administration measures as prescribed; carry out compliance assessment and classification of risks for the following assessment period.

3. In case of invalidation of tax identification number (TIN)

Carry out inspection or audit of annual tax finalization dossiers at the taxpayer’s premises based on the risk classification results in descending order.

Update the “dissolved”, “bankrupt”, or “suspended business" status on the tax registration system if the taxpayer has fulfilled tax obligations as prescribed. Adopt measures for expediting the taxpayer to fulfill tax obligations before dissolution, bankruptcy or business suspension as prescribed.

4. In other cases: Frequently review to detect signs of high risks and make the list of taxpayers whose operation status needs to be verified at their business premises.

Article 17. Management of risks in inspecting tax declaration dossiers at tax authorities

Based on the list of taxpayers classified into levels of risks associated with tax declaration dossiers as prescribed in article 13 hereof, appropriate measures shall be adopted to process tax declaration dossiers.

1. High risk: Carry out analysis of documents, make and submit the list of taxpayers whose tax declaration dossiers are inspected at tax authorities to heads of the tax authorities, and carry out inspection of tax declaration dossiers a tax authorities as prescribed;

2. Medium and low risks: Inspection of tax declaration dossiers at tax authorities is not necessary; tax authorities shall carry out compliance assessment and classification of risks associated with taxpayers’ tax declaration dossiers to serve the following assessment period.

Article 18. Manage risks associated with tax refund

Tax authorities shall classify claims for tax refund in accordance with regulations of the Law on tax administration and relevant legislative documents or regulations in force. If claims for tax refund are classified by risks, based on results of classification of risks associated with claims for tax refund as prescribed in Article 13 hereof, tax authorities shall adopt appropriate measures for processing the claims for tax refund as follows:

1. Classification and processing of claims for tax refund

a) High-risk claims for tax refund: Inspection shall be carried out before tax refund

Within 12 consecutive months from the beginning of the fiscal year, a taxpayer has claim for tax refund continuously assessed as posing high risks:

a.1) If total risk scores or risk score given to each criterion or indicator in the current assessment of risk are or is different from those in the previous assessment: the claim for tax refund is subject to inspection before tax refund.

a.2) If total risk scores and risk score of each criterion or indicator given in the current assessment of risk are same as those given in the previous assessment; or a lower risk score is given to each indicator in the current assessment resulting total risk scores given in this assessment lower than those given in the previous one:

- If no sign of understatement of tax payable or overstatement of tax eligible for refund is found in the previous inspection of the claim for tax refund or post-refund inspection or audit, the following claim for tax refund shall not be subject to inspection before tax refund.

- If any signs of understatement of tax payable or overstatement of tax eligible for refund are found in the previous inspection of the claim for tax refund or post-refund inspection or audit, the following claim for tax refund shall be subject to inspection before tax refund.

b) Medium- and low-risk claims for tax refund: Tax shall be refunded before inspection.

c) In case, after classification of claims for tax refund and during the processing of the claims for tax refund, the tax authority has detected a taxpayer showing signs of violations against tax or customs laws, or in case a taxpayer fails to provide explanations or additional information or documents or the explanations and documents provided by the taxpayer cannot prove that the declared tax amount is accurate, the tax authority shall change the claim’s category from claim eligible for tax refund before inspection to claim subject to inspection before tax refund; the approval for change of a claim’s category must be updated on the professional information system.

2. Post-refund audit

a) The order of taxpayers subject to post-refund audit shall be arranged by tax authorities according to taxpayers’ total risk scores in descending order within five (05) years from the issue date of tax refund decision:

a1) High risk (regarding claims for tax refund which are not subject to inspection before tax refund as prescribed in Point a Clause 1 of this Article): Post-refund audit shall be carried out within 01 year from the issue date of the tax refund decision;

a2) Medium risk: Post-refund audit shall be carried out within 03 years from the issue date of the tax refund decision;

a3) Low risk: Post-refund audit shall be carried out within 05 years from the issue date of the tax refund decision;

a4) Depending on actual conditions, post-refund audits may be carried out before the abovementioned time limits.

b) The General Department of Taxation shall provide specific provisions on post-refund inspections and audits which should be combined with inspection of compliance with tax laws as prescribed.

Article 19. Management of risks in carrying out inspections and audits at premises of taxpayers

1. Tax authorities shall select taxpayers subject to inspections or audits at their premises as follows:

a) The number of taxpayers selected through analysis and assessment of compliance, and classification of taxpayer risks shall be at least 90% of the number of taxpayers subject to the annual inspection or audit plan;

b) The number of taxpayers that are randomly selected shall not exceed 10% of the number of taxpayers subject to the annual inspection or audit plan.

2. Select taxpayers subject to the plan for inspection at taxpayers’ premises

Based on the list of taxpayers classified into levels of risks associated with tax inspection and audit prescribed in Article 13 hereof, tax authorities shall select taxpayers that shall bear inspections or audits at their premises as follows:

a) Select taxpayers subject to inspection: Taxpayers shall be selected to place under the annual plan for inspection of taxpayers at their premises according to their risk classification results in descending order.

b) Select taxpayers subject to audit: Taxpayers shall be selected to place under the annual plan for audit of taxpayers at their premises according to their risk classification results in descending order. Selected taxpayers must be not the ones subject to the annual inspection plan prescribed in Point a Clause 2 of this Article.

c) The application of risk management to selection of taxpayers with signs of risks for developing tax inspection and audit plans must be carried out in a manner that avoids duplication and overlapping in accordance with regulations of the Law on tax administration, its guiding documents and relevant legislative documents.

During performance of tax administration tasks, if a tax authority has received reliable information to lower a taxpayer’s level of risk to the low level or has grounds to believe that the taxpayer is considered as low risk and not necessary to place under the annual inspection or audit plan, the tax authority shall decide not to place that taxpayer under the inspection or audit plan and select another taxpayer for the annual inspection or audit plan as prescribed. During performance of tax administration tasks, if there is any information which is collected and verified showing a taxpayer posing signs of high risks, the tax authority shall add that taxpayer to the annual inspection or audit plan. The tax authority shall assume responsibility for its decision on change of selected taxpayer.

d) Development and authority to approve the plan for inspection or audit of taxpayers at their premises, and the list of selected taxpayers enclosed with the plan as prescribed in this Article shall comply with regulations of the Law on tax administration, its guiding documents and relevant legislative documents.

3. Based on results of analysis of risks by the information technology application or risks from operational analysis, information collected during the performance of tax administration tasks, tax authorities shall determine contents and scope of the tax inspection or audit.

Article 20. Management of risks in managing tax debts and implementing tax enforcement decisions

Based on the list of taxpayers classified into levels of risks associated with tax debt management and implementation of tax enforcement decisions as prescribed in Article 13 hereof, tax authorities shall manage tax debts and implement tax enforcement decisions in accordance with regulations of the Law on tax administration and its guiding documents while taking into account the levels of risks for prioritizing or expediting actions.

1. High risk: Based on actual conditions, tax authorities shall select, from the list of taxpayers subject to tax enforcement measures, taxpayers from which tax debts can be collected, taxpayers with large tax debts, taxpayers suspected of liquidating assets or absconding, and taxpayers that want to leave Vietnam for increasing frequency of expediting actions or against them actions will be taken first;

2. Medium and low risks: Monitor, expedite and implement debt collection measures in accordance with regulations of the Law on tax administration and its guiding documents.

Article 21. Management of risks in managing invoices, records and other tax administration operations

1. Management of risks in managing invoices and records:

Based on the list of taxpayers classified into levels of risks associated with management of invoices and records as prescribed in Article 13 hereof, tax authorities shall adopt tax administration measures as follows:

a) High risk: Include high-risk taxpayers in the list of taxpayers to be reviewed or subject to inspection at tax authorities, and consider placing them under the annual plan for inspection or audit of taxpayers at their premises according to the Law on tax administration, its guiding documents and relevant legislative documents. Based on inspection or audit results, taxpayers are requested to buy invoices from tax authorities, or use authenticated e-invoices or comply with other invoice management measures in accordance with regulations in force; tax authorities shall decide the form of invoices used by taxpayers that use invoices for the first time;

b) Medium and low risks: Select samples for reviewing, inspecting, processing and assisting taxpayers in strictly complying with regulations of law on invoices.

The General Department of Taxation shall stipulate sampling methods which should be appropriate for tax administration requirements set by each local government and in each period.

2. Management of risks in other operations

Based on the levels of risks in other operations and relevant information, tax authorities shall decide to adopt professional measures appropriate for performance of their functions and tasks.

Article 22. Emphasized supervision of taxpayers showing signs of violations against tax laws

1. Taxpayers shall be kept under the emphasized supervision if they have one of the following signs:

a) Their bank transactions show suspicious signs in accordance with regulations of the Law on anti-money laundering in terms of tax evasion and tax fraud.

b) They or their legal representatives are under investigation for their violations related to taxes, invoices and evidencing records.

c) They have signs of high tax risks to the extent of being classified as subjects of emphasized supervision or need to keep under tax supervision through information collected for tax authorities' administration.

d) They are selected from the list of taxpayers that are non-compliant as prescribed in Article 10, the list of very high-risk and high-risk taxpayers as prescribed in Clause 1 Article 11 hereof and those failing to provide explanation and additional information or those providing explanation and additional information but they are inadequate or are submitted after the prescribed deadline stated in written notices of tax authorities.

2. Tax authorities at all levels shall monitor, supervise and apply tax administration measures appropriate for each case specified in Clause 1 of this Article.

3. The General Department of Taxation shall provide specific provisions on collection and analysis of information, and determination of subjects of emphasized supervision and supervisions methods in conformity with regulations of law in each period.

Article 23. Inspection and assessment of application of risk management to tax administration

1. Carry out inspection and assessment of the following contents:

a) Quality of implementation of risk management measures/techniques;

b) Validity and efficiency of application of risk management to tax administration operations;

c) Implementation of decisions on inspection or audit or other professional measures issued on the basis of application of risk management, and results thereof;

d) Assessment of efficiency of compliance assessment and risk classification criteria and indicators.

2. Inspection and assessment methods:

a) Consolidate reporting information and figures of tax authorities at all levels, departments and units affiliated to the General Department of Taxation during the application of risk management;

b) Collect, analyze and consolidate results of application of risk management in tax administration operations;

c) Establish inspection teams to inspect the implementation and application of risk management by tax authorities at all levels.

3. The Director General of General Department of Taxation shall assign risk management units to inspect and assess the implementation and application of risk management to tax administration as prescribed in Clause 2 of this Article. Assessment shall be carried out frequently; reports shall be submitted on a periodical basis (6 months and every year) and whenever they are deemed necessary to meet operational requirements.

Article 24. Supervision and assessment of plans for improving compliance

1. Carry out inspection and assessment of the following contents:

a) The implementation of the plan for improving compliance;

b) Outcomes and efficiency of the plan for improving compliance. To be specific:

b.1) Validity and efficiency of treatment measures adopted by tax authorities based on risk identification and analysis according to each segment of taxpayers;

b.2) Actual results and expected results of measures for minimizing risks through compliance measurement.

c) The application of transparency process to development and implementation of the plan for improving compliance;

d) Improvement of overall compliance of different groups of taxpayers and tax obligations;

dd) Organizational structure and human resources of tax authorities at all levels for implementing the plan which must ensure the validity and efficiency of the plan according to the plan’s objectives.

2. Supervision and assessment methods

a) Consolidate reporting information and figures of tax authorities at all levels, departments and units affiliated to the General Department of Taxation during the implementation of the plan for improving compliance;

b) Collect, analyze and consolidate information about the plan implementation results;

c) Establish inspection teams at tax authorities at all levels.

3. The Director General of General Department of Taxation shall assign risk management units to supervise and assess the implementation of the plan for improving compliance as prescribed in Clause 2 of this Article. Supervision and assessment of the plan for improving compliance shall be frequently carried out and reported on a periodical basis (6 months and every year) and whenever they are deemed to meet the progress of the plan.

Chapter V

IMPLEMENTATION ORGANIZATION

Article 25. Responsibility for implementation

1. Agencies and units affiliated to the Ministry of Finance and relevant ministries, organizations and individuals involved in tax administration shall provide information and cooperate in applying risk management to tax administration in accordance with regulations of laws in force and regulations herein.

2. Pursuant to guidelines given herein, the Director General of General Department of Taxation shall:

a) Promulgate indicators specified in Article 10, Article 11 and Article 12 hereof to meet tax administration requirements in each period; annually review and amend such indicators to meet actual conditions;

b) Promulgate specific provisions on responsibilities of tax authorities at all levels, tax officials and measures to collect and process risk management information; scores, weighing factors and measures used for risk management in tax administration;

c) Promulgate procedures, rules and guidelines for application of risk management to tax administration.

3. The risk management unit shall act as the contact point and take charge of:

a) Managing and operating the risk management application and other information and data systems serving risk management as assigned;

b) Organizing, providing professional instructions, and inspecting the collection and processing of risk management information; risk management measures and techniques, and application of risk management to tax administration operations;

c) Managing sets of indicators promulgated by the Director General as prescribed in Point a Clause 2 of this Article on the risk management information system and relevant information systems, monitoring, assessing and adjusting indicators to meet management requirements in each period.

4. Sub-Departments of Taxation, Regional Sub-Departments of Taxation, Provincial Departments of Taxation, units affiliated to the General Department of Taxation, and tax officials shall strictly and fully implement regulations on application of risk management herein and relevant documents.

Article 26. Effect

1. This Circular comes into force from July 02, 2021.

2. This Circular supersedes the Circular No. 204/2015/TT-BTC dated December 21, 2015 of Ministry of Finance.

3. If any legislative documents referred to in this Circular are amended or superseded, the new ones shall apply./.

 

MINISTER Ho Duc Phoc