New Proposal on Applying Risk Management in Tax Administration

23/03/2021, 08:26 AM

The Ministry of Finance said that the application of risk management in tax administration has been specified in legal documents. However, the application process over the past time shows that a number of contents need to be further revised, supplemented, and improved to suit the actual situation, requirements for reform and modernization of the tax system, and national practices, as well as to ensure the legal basis for continuing to promote the application of risk management in tax administration.

The content of this draft Circular prescribes a comprehensive and comprehensive application of risk management throughout the tax administration functions and operations from tax registration; tax declaration; check; tax inspection; manage invoices, documents and other functions and operations of tax administration. Including:

Publicly stipulating criteria for assessing tax compliance and taxpayer risk levels to ensure publicity, transparency in assessing taxpayers, at the same time for taxpayers to compare evaluation criteria to reimburse meditation, thereby improving taxpayers' voluntary compliance.

Tax agency (General Department of Taxation) is responsible for issuing criteria indicators, helps tax authorities to flexibly manage their risks, be proactive in changing the criteria index to suit tax management reality in each period; contribute to minimizing unnecessary administrative procedures for the ministry.

The results of the risk analysis are inherited, the assessment results in the previous stage are part of the evaluation criteria in the next stage. In which, the result of assessing tax compliance with the taxpayer and the result of taxpayer rating is one of the criteria for risk analysis in tax administration operations.

Approach according to OECD (Organization for Economic Cooperation and Development) documentary approach with a compliance triangle model with 4 layers corresponding to 4 levels of compliance - It is a model that has been applied for a long time in tax authorities of many countries and until now, no other factors have changed the structure of this model. Therefore, the draft Circular has comprehensively approached this model instead of the 3 levels specified in Circular 204:

Specifically, Level 1: High compliance; Level 2: Moderate compliance; Level 3: Low compliance; Level 4: Noncompliance.

In addition, taxpayers are assessed for overall risk and classified into 5 classes: Class 1: The taxpayer has very low risk; Class 2: Low-risk taxpayer; Grade 3: Average risk taxpayer; Class 4: High-risk taxpayer; Rank 5: The taxpayer is very risky.

The draft for class 6 removal (taxpayers established under 12 months) specified in Circular 204 will be classified and monitored separately in accordance with the requirements of each profession when conducting risk assessment.

According to the Ministry of Finance, but the amendments, supplements and guidance in the draft Circular are aimed at preserving the effectiveness and efficiency of tax administration; fair treatment among taxpayers by prescribing sanctions against taxpayers by prescribing sanctions against high-risk taxpayers, in violation of the law. on tax and the option to commend and reward taxpayers for complying with tax laws; At the same time, it encourages and creates favorable conditions for taxpayers to voluntarily comply with the provisions of tax laws and tax administration.

Source: Bao Chinh Phu