MoF submits to the Government to extend the deadline for payment of taxes

The State’s support policies will help businesses overcome difficulties due to the impact of the pandemic. Photo: Internet.

Ensuring extension for accurate beneficiaries

According to the Ministry of Finance, the Covid-19 pandemic has continued to develop in a complicated and unpredictable manner. In fact, many sectors have suffered from difficulties, the operation of businesses has been suspended, especially small-sized enterprises.

The decrease in sales and interruption of commercial transactions has caused difficulties in balancing the financial resources of businesses to maintain production and business activities.

Therefore, the State's support policies through extending the deadline for payment of taxes and fees will help enterprises to overcome difficulties caused by the pandemic and restore production.

The Ministry has gathered feedback from ministries, government agencies and organizations about the draft Government Report and draft Decree on extending the deadline for payment of Value Added Tax, Corporate Income Tax, Personal Income Tax and land and water surface rent in 2022.

The Ministry has received comments from ministries, government agencies, People's Committees of provinces and cities, and collected feedback from Vietnam Chamber of Commerce and Industry and Vietnam Tax Consultations’ Association.

Currently, the ministry has completed the draft decree.

Regarding the selection of beneficiaries for the extension of the payment deadline, beneficiaries must be enterprises, organizations, business households and individuals affected by the Covid-19 pandemic. It is necessary to facilitate the tax administration, avoid increasing administrative procedures and prevent revenue loss.

Many are eligible for tax extension

In the draft Decree, the Ministry of Finance proposes to continue extending the deadline for paying taxes and land and water surface rents for all the entitles specified in Article 2 of the Government Decree 19/04/2021.

The Ministry suggests that the decree stipulates the extension of the deadline for payment of value-added tax, corporate income tax, personal income tax and land rent as per Decree 52/2001/ND- CP and the deadline for paying water surface rent in 2022, helping businesses and individuals have more financial resources to restore production and business.

To ensure the state budget balance in 2022, the Ministry proposes a 6-month extension of the Value-added tax from March to May and the first quarter of 2022, a 5-month extension for the value-added tax of June and the second quarter, a 4-month extension for the value-added tax of July, a 3-month extension for the value-added tax of August for enterprises and organizations eligible for tax extension.

According to the Ministry of Finance, if the extension is implemented under the above plan, the total value-added tax amount will be extended from March to August and the first and second quarters in 2022 is worth about VND53,300-54,300 billion.

For corporate income tax, the Ministry of Finance proposes to extend the payment deadline for the temporarily paid corporate income tax amount of the first quarter, the second quarter of the corporate income tax term 2022. The extended deadline is three months from the end of the deadline for paying corporate income tax as per the law on tax administration. It is estimated that the extended tax amount is about VND51,000-52,000 billion.

To remove obstacles for business households and individuals, the Ministry also proposes to extend the payment deadline of value-added tax and personal income tax for business households and individuals. These taxpayers are allowed to pay the extended taxes no later than December 30, 2022. Accordingly, the extended tax amount is estimated at VND15,304 billion.

For land and water surface rents, as per the provisions of Clause 3, Article 18 of the Government Decree 126/2020/ND-CP dated October 19, 2020 detailing a number of articles of the Law on Tax Administration, the time limit  for paying the annual land and water surface rents is 2 terms (50% of rent is paid in the first term on May 31; the rest is paid the second term on October 31 every year).

The Ministry proposes that the payment of 50% of total land and water surface rent payable in 2022 will be extended by six months from May 31 to November 30, 2022. It is expected that the extended amount is about VND3,500-3,700 billion.

Because this is an urgent solution that needs to be issued immediately to support businesses and people affected by the pandemic, the Ministry has submitted to the Government for permission for the Decree to take effect from the date of signing.

If the decree is issued, it will support and reduce difficulties for businesses and individuals engaged in production and business activities. The extension of tax payment, land and water surface rents helps taxpayers have more financial resources to maintain and restore production, thereby removing difficulties for production and business, contributing to achieving the economic growth target for the whole of 2022.