Abandoning the enterprise without liquidating all its obligations, especially the one that owes tax, will lead to problems such as:

1.  Suspended exit from Vietnam for Legal Representative / Business Director.

2. Compulsory application;

3. New businesses are not allowed to be established;

4. Unable to carry out business procedures;

Currently, there are many businesses with a number of different reasons, leading to a tax debt situation that they cannot afford or refuse to fulfill their tax obligations but also do not dissolve the business. According to statistics, there are tens of thousands of businesses in a state of tax debt, with the tax debt amounting to hundreds of billions of dong. 

Understanding the situation, the law has appropriate sanctions for businesses to comply with regulations and supports the Tax Administration, the Ministry of Finance in managing and recovering tax debts for the State. So when the business is owed tax but does not comply with the tax obligation according to regulations, what problems will it encounter?

1. Suspended exit from Vietnam while owed tax:

- Legal provisions: “Taxpayers who are being coerced to execute administrative decisions on tax administration, Vietnamese people exiting to settle abroad, Vietnamese residing abroad, foreigners before exiting the country. from Vietnam must fulfill the tax payment obligation; If the tax payment obligation has not been fulfilled, Delayed exit according to the provisions of the law on exit and entry. Tax administration agencies are responsible for notifying exit and entry management agencies about individuals and taxpayers.”

– The procedure is as follows:

a) After reviewing, comparing and accurately determining the taxpayer's tax obligations, the tax administration agency directly managing the taxpayer shall make a list of individuals and individuals who are the legal representatives. of enterprises subject to temporary suspension of exit and send them to the immigration management agency and at the same time to the taxpayer to fulfill the tax payment obligation before exiting the country.

b) Right on the day of receiving the written suspension from the tax authority, the immigration authority is responsible for implementing the suspension as prescribed and posting it on the website of the tax authority. Immigration agency.

c) In case the taxpayer has fulfilled the tax payment obligation, within 24 working hours, the tax authority shall issue a document to cancel the temporary export suspension and send it to the immigration authority to cancel the temporary export suspension. Postponing exit according to regulations.

If the taxpayer has not fulfilled the tax payment obligation before the expiration of the 30-day period of temporary exit suspension, the tax authority shall send a written extension of the exit suspension to the immigration authority and concurrently send the taxpayer to the immigration authority. tax payers know.

d) Documents of suspension from exit, extension of suspension from exit, or cancellation of exit suspension shall be sent by post or by electronic method if all conditions are met and posted on the website. electronic information of tax administration agencies. If the document sent to the taxpayer by post is returned and the document has been posted on the website of the tax authority, the document is considered sent.

Therefore, enterprises that owe tax but are forced to execute administrative decisions on tax administration, the legal representative of the enterprise will be suspended from exiting Vietnam until the payment obligation is fulfilled. tax.

2. Being subject to coercive sanctions when leaving an enterprise that owes tax:

– Cases where businesses are forced to owe tax to taxpayers:

+ Taxpayers owe tax and late payment interest more than 90 days after the expiration of the tax payment time limit or extension according to the provisions of the Law on Tax Administration and competent state agencies;

+ Taxpayers who still owe tax, fines and late payment money but have absconded or dispersed their properties;

+ Taxpayers who do not comply with the decision on sanctioning of administrative violations of tax within 10 days from the date of receipt of the decision on sanctioning of administrative violations of tax are forced to execute the decision on sanctioning of administrative violations. tax offenses.

If the decision to sanction a tax administrative violation has an execution term of more than 10 days, but the taxpayer fails to comply with the sanctioning decision within the time limit stated in the sanctioning decision, the taxpayer shall be forced to execute the sanctioning decision. fines for tax administrative violations (except for cases of postponement or temporary suspension of execution of decisions on sanctioning of tax administrative violations).

In addition, there are also some more violations below:

+ The credit institution fails to comply with the decision on administrative sanctions on tax according to the provisions of the Law on Tax Administration and the Law on Handling of Administrative Violations;

+ Organization guaranteeing tax payment for taxpayers: 90 days beyond the prescribed time limit - counting from the deadline for paying tax, fines, and late payment interest according to the written approval of the tax authority that the taxpayer If tax has not been fully paid into the state budget, the guarantor will be coerced according to the provisions of the Law on Tax Administration and the Law on Handling of Administrative Violations;

+ The State Treasury fails to deduct money from the account of the subject of coercion opened at the State Treasury to remit into the state budget according to the tax authority's decision on sanctioning administrative violations;

+ Related organizations and individuals fail to comply with competent agencies' decisions on sanctioning administrative violations of tax.

– Coercive measures that the Tax Authority will apply to the Taxpayer:

+ Deduct money from accounts, blockade accounts of taxpayers subject to enforcement of administrative decisions on tax administration;

+ Partial deduction of salary or income;

+ Stop carrying out customs procedures for exported and imported goods;

+ Stop using invoices;

+ Distraint of assets, auction of distrained assets;

+ Collecting money and other assets of taxpayers that are coerced by other agencies, organizations and individuals;

+ Revocation of enterprise registration certificate, business registration certificate, cooperative registration certificate, investment registration certificate, establishment and operation license, and practice license.

In case a decision on enforcement by subsequent measures has been issued but there are information and conditions for the implementation of the previous coercive measure, the person issuing the decision on enforcement has the right to decide to terminate the current coercive measure. implement and issue a decision to take coercive measures in advance to ensure the full collection of tax, fines and late payment interest.

Therefore, businesses that owe tax will not only be forced by the State to pay all the taxes owed, but also may be subject to property distraint, unable to carry out import and export activities, unable to use invoices. ... These problems will cause a stagnation of the production and business situation, affecting the reputation of the business for its partners and customers if the business still wants to operate.

3. It is not allowed to establish a new enterprise if there was an enterprise with tax debt that has not yet completed the dissolution procedures:

Unable to repay the debt, some businesses have chosen the option of "quitting the business". However, after a period of "silence", these business owners continue to want to establish another business and ignore the "debt tax" of the old business.

But thanks to regulations on information communication between State agencies, this issue has been handled. When receiving the application for registration of business establishment, the Department of Planning and Investment will request the General Department of Taxation to ｇｒａｎｔ a tax identification number to the enterprise. After receiving the request, the General Department of Taxation conducts a search and review according to personal identification information, the representative who is in the name of the business that owes tax will not be granted a tax code to establish a new business which will be required to settle the outstanding tax debt of the old business first.

Some typical examples are as follows:

Example 1: Company A, registered for establishment by Mr. Nguyen X as the legal representative, was notified by the Department of Planning and Investment: “Mr X – Identity card number 26xxx, is the legal representative. Law of Company G was established in January 01 and headquartered in Dong Da”. According to the notice of the Hanoi Tax Department, Mr. X has abandoned his business location.

Example 2: Looking up on the National Business Registration Portal, Ms. Do D is in the name of the legal representative of 06 companies established in 2006, 2008, 2009, 2011, 2014 and 2015. In which , the company in Bui Thi Xuan and Ba Dinh District has been operating for 03 years and has not yet closed its tax code, then the company stopped doing business for a while.

The business registration system always updates regularly and continuously information and status of businesses and individuals, based on notifications received from other state agencies. In addition, the Tax Departments of the provinces/cities also have a list of all cases where businesses owe tax in the area. Therefore, for the cases where the enterprise owes tax as above, the Business Registration Authority will refuse to ｇｒａｎｔ a new License when the business owner has not yet dealt with the tax debt of the old enterprise.

4. Unable to carry out business procedures at the Department of Planning and Investment while being coerced for tax debt

The written request for enforcement of tax debt is sent not only to the enterprise but also to the Department of Planning and Investment where the enterprise's head office is located. Upon receipt of this document, the Department of Planning and Investment will proceed business registration system key on the National Business Registration Portal. Only when the enterprise has fully processed the tax debt and required the forced unlocking to restore its normal legal status, the business procedures can be carried out.

Usually businesses will not care or do not know their business is locked forcibly. The effect is obvious and takes the most time to resolve is that enterprises do not have time to handle the unlocking to carry out business procedures. Because according to the provisions of the Law on Enterprises, when there is a change in business registration information, the enterprise must notify the Department of Planning and Investment within 10 days from the date of change or when it wants to suspend. business, must notify at least 03 working days before the date of business suspension.

The consequence in this case is that the enterprise cannot notify the Department of Planning and Investment in accordance with regulations, so it cannot change the head office address, change the industry, ... according to the plan. Or more troublesome is not suspending business in time, causing filings, tax costs and other costs while the business processes and waits for the restoration of normal legal status.

From the foregoing, if a business has tax debts that are due to be completed without performing the obligations, it will face a lot of problems, affecting not only the business but also the whole country. The representative of the enterprise himself. There are many businesses that are still taking this issue lightly, so it will be difficult for them to handle time and procedures until they have to leave the country or be coerced to handle them.

Legislation:

– Law on Enterprises: effective from January 01, 01;

– Law on tax administration: effective from July 01, 07;

– Decree 01/2021/ND-CP: effective from 04/01/2021;

– Decree 126/2020/ND-CP: effective from 05/12/2020;

– Circular 215/2013/TT-BTC: effective from 21/02/2014;