Lesson 3: Improving the efficiency of tax management for household businesses
According to the overview of household business management in Nghe An province in 2024, the total number of registered households is over 50,000, including approximately 23,000 households under contract, over 800 households under declaration, and over 27,000 low-income households. This sector plays a crucial role in creating jobs, increasing income for workers, contributing to the development of the business sector, and playing a part in the supply chain of goods in Nghe An province and the country as a whole.
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According to the overview of household business management in Nghe An province in 2024, the total number of registered households is over 50,000, including approximately 23,000 households under contract, over 800 households under declaration, and over 27,000 low-income households. This sector plays a crucial role in creating jobs, increasing income for workers, contributing to the development of the business sector, and playing a part in the supply chain of goods in Nghe An province and the country as a whole.
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Over the years, the Nghe An Tax Department in general, and the Nghe An Tax Bureau in particular, have devoted significant resources to managing and collecting taxes from individual business households through various measures. Especially since the promulgation of the new Tax Administration Law, the management of individual business households has been concretized by Circular 40/2021/TT-BTC of the Ministry of Finance. Guidance and management have been strengthened with various forms and measures to ensure the timely mobilization of revenue from individual business households for the state budget. In addition, emphasis has been placed on nurturing revenue sources and creating conditions for business households to develop into cooperatives and enterprises.
In the context of digital technology, e-commerce is dominant, with everyone engaging in business. This necessitates revisions to the tax system to adapt, encompass, and monitor across digital platforms. Combating tax evasion while simultaneously facilitating trade and commerce for citizens is crucial.
In 2024, the Nghe An Provincial Tax Department issued numerous directives on the management of household business taxes. These included Official Letter No. 5858/CT-HKDTK directing the tax registration process for 2024; Official Letter No. 821/CT-HKDTK dated February 1, 2024, from the Nghe An Provincial Tax Department on rectifying the tax registration process for household and individual businesses in 2024 following the results of the tax stability data audit by the Provincial Tax Department; directives on managing household businesses using digital mapping functions; on managing and combating tax evasion in the transportation sector; and directives on reviewing and managing seasonal business operators…
The Nghe An Provincial Tax Department has implemented several tax management software programs. These include software for managing household businesses such as the Digitalization of Household Business Management using a Digital Map; software for managing transport businesses; software for managing tax declarations; and software for tax payment via mobile devices (Etax Mobile). In particular, the deployment of Etax Mobile has been actively embraced by household businesses due to its practicality and effectiveness. To date, 63,966 Etax Mobile accounts have been registered in the province. The total amount of taxes successfully paid through Etax Mobile is over 43 billion VND, with a cumulative total of over 205 billion VND paid through Etax Mobile in 2024.
The Song Lam II Regional Tax Office is one of the units that effectively implements tax management solutions for business households. According to statistics, the total number of tax-managed households in the two districts of Nam Dan and Hung Nguyen is 4,928, including 1,502 cases with established tax management records, 3,380 low-income households, and 78 households paying taxes using the declaration method. In 2023, the tax revenue from business households in the two districts of Hung Nguyen and Nam Dan was VND 11.8 billion, reaching 199% of the target; in the first 10 months of 2024, it reached VND 14.8 billion, achieving 192% of the target.
Mr. Ngo Tien Hung, Deputy Head of the Song Lam II Tax Sub-Department, stated: In the digital age, tax authorities are currently applying applications, software, and solutions to collect taxes from business households more effectively, including: the centralized tax management application TMS, invoice management applications, electronic invoice alert applications, electronic tax declaration software, and the Etax Mobile electronic tax payment application.
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Each year, the Sub-Department implements many effective initiatives and solutions in the management of household business taxes, which are recognized by the Nghe An Provincial Tax Department's Innovation Council. In 2024, the initiative "Combating Tax Evasion in Accommodation Services" was effectively implemented and recognized by the Nghe An Provincial Tax Department in Decision No. 4934/QD-CT. As a result, in over four months of implementation, the initiative prevented tax evasion of nearly 300 million VND, and it will continue to be strongly implemented in the future.
Currently, individual business households are developing and diversifying, contributing to job creation, poverty reduction, and increased revenue for the state budget. However, the business situation in this sector is quite complex. In the age of technology, business activities have become more diverse in methods, with payment exchanges taking many forms, making it difficult for tax authorities to determine information, easily leading to missed revenue and budget losses.
Regarding the fight against tax evasion related to individual business households, in 2024, the Nghe An Tax Department implemented many specialized programs and achieved positive results. Specifically, concerning the program to review seasonal individual business households, the Tax Department directed the review and management of seasonal businesses according to Official Letter No. 3535. As a result, the Tax Sub-departments added 622 households to their tax records. The additional tax revenue exceeded 1 billion VND per month.
Regarding the program to combat tax evasion by businesses importing agricultural products, as per Official Letter No. 3970/CT-TTKT1, the Tax Sub-departments have reviewed, processed, and collected back taxes from individual businesses importing agricultural products in their respective areas. The amount of back taxes collected and paid to the state budget from 20 businesses importing agricultural products has increased by over 22 billion VND.
To improve the effectiveness of tax management for household businesses in the coming period, the Nghe An Tax Department has directed its subordinate tax offices to focus on building complete documentation and procedures for managing individual businesses under the lump-sum tax system as prescribed, reviewing and compiling statistics to bring 100% of household businesses in the area under management, ensuring increased revenue as stipulated by the Ministry of Finance. They are proactively coordinating with the People's Committees of communes and towns to manage household business taxes accurately and precisely based on the tax revenue paid by each business. They are also regularly inspecting and monitoring the issuance of electronic invoices by businesses declaring on the electronic invoice management application; and strengthening management of accommodation service businesses and household businesses operating on e-commerce platforms and other digital platforms.
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The "Lucky Invoice" program, implemented by the Nghe An Provincial Tax Department, aims to encourage buyers to obtain invoices when purchasing goods and services to manage business revenue, prevent tax evasion, and encourage sellers of goods and services to use electronic invoices with tax authority codes. This is one of the solutions to strengthen tax management for business households, prevent state budget revenue losses, and contribute to the modernization and digitalization of tax management in the tax sector. To date, the Nghe An Provincial Tax Department has organized six lucky invoice draws and awarded prizes to lucky customers.
Mr. Nguyen Duc Canh, one of the winners of the lucky receipt program in Nghe An province in 2024, said: "I am very happy because I never expected that getting a receipt when buying goods would bring me so many benefits. Besides winning a big prize, getting and keeping electricity receipts also helps shoppers like us to be protected by law in commercial transactions."
With its attractive prize structure, the program has created positive changes for both buyers and sellers. For buyers, the prizes encourage them to request invoices when purchasing goods and services, helping them change and establish civilized consumption habits – that is, purchasing goods with legitimate invoices and documents, and contributing to the maximum protection of consumer rights. For sellers, the program attracts individual customers, helping them increase sales revenue.
The "Lucky Receipt" program is an initiative aimed at changing people's habit of not requesting receipts when making purchases, thereby creating transparency, maximizing consumer rights protection, and improving the efficiency of tax management, contributing to increased state budget revenue, especially in the area of business household taxes.
With the trend of integration and closer monitoring via the internet, the Nghe An Tax Department has also flexibly coordinated with various sectors and levels to better collect taxes on gold and silver, food and beverage businesses, restaurants, hotels, housing construction, taxis, and transportation. These are mostly businesses that declare taxes.
