People have their tax codes stolen, "shoulder" sky-high income

Easy to steal informationpersonal and appropriation

Recently, the Tax Department of District 8, Ho Chi Minh City received a complaint from Ms. Pham Thi Ngoc Chau (residing in Ward 10, District 8) that when settling personal income tax, she discovered that in 2016, there was an additional commission from Ky Hoa Tourism - Trade Company Limited - Ky Hoa Vung Tau Hotel (Vung Tau City). In fact, she did not know anything about this unit. Due to that "sky-high" income, Ms. Chau was notified by the Tax Department of District 8 to pay additional taxes. After receiving Ms. Chau's complaint, the Ba Ria - Vung Tau Tax Department went to Ky Hoa Company to work and this company admitted to falsely declaring commission payments to Ms. Chau according to the personal tax code obtained, to increase costs, reduce revenue, and reduce the amount of tax payable.

Previously, 4 teachers at Marie Curie School (District 3, Ho Chi Minh City) were also notified to pay additional taxes. When checking their income sources, the teachers discovered that they had additional income from Just Analytics Vietnam Co., Ltd. (District 1, a foreign-invested enterprise). These teachers had to write a commitment to the tax authority not to receive any money from Just Analytics Vietnam Co., Ltd. before the Ho Chi Minh City Tax Department could verify and handle the matter.

Many people only know that their information was stolen by businesses to make false declarations when they go to pay taxes.

Ms. Le Thi Thu Huong, Deputy Director of the Ho Chi Minh City Tax Department, said that recently, the tax department has also received some complaints from people whose tax codes were used by unknown businesses to declare expenses for salaries and wages. According to Ms. Huong, after receiving complaints from people about the tax department's cases, the tax department will start to verify and handle them. In the case of Ms. Chau and 4 teachers at Marie Curie School or individuals in similar situations, according to Ms. Huong, they only need to commit not to receive the income portion falsely declared by other units to be eliminated. Regarding Ky Hoa Company, the Ho Chi Minh City Tax Department has transferred the file to the Ba Ria - Vung Tau Tax Department for handling.

Recently, on tax forums, there have been many reflections and discussions from many people about how to handle cases where individuals are taken by organizations or businesses to register for tax codes, declare salary payments to reduce income. Among them, many new employees, when carrying out tax code registration procedures, discovered that they had been registered for tax codes since their student years. The place to register for tax codes is in provinces that they have never been to...

A tax consultant said that it is not difficult for businesses to steal personal identification cards and tax codes to falsify payroll to evade taxes and it happens in many places. Through the personal tax codes obtained, businesses with only 10 employees can declare 15-20 employees. This method helps increase labor costs and reduce taxable income, even turning profits into losses to avoid paying taxes. "This is the method many businesses are using to evade taxes," said the expert.

Can be prosecutedtax evasion

Ms. Ta Thi Phuong Lan, Deputy Director of the Personal Income Tax Management Department (General Department of Taxation) said that the situation of businesses and organizations stealing personal tax codes to declare expenses has arisen since 2009, when the Personal Income Tax Law took effect. However, according to Ms. Lan, the damage to the state caused by businesses and organizations stealing personal tax codes to declare expenses to evade taxes is not large. There have been no cases of taxpayers being taken advantage of suffering damage (having to pay additional taxes, being fined, etc.). "The damage to individuals and the tax industry is not very large, so we do not have statistics on violating businesses," Ms. Lan said.

According to Ms. Lan, the abuse of tax codes to declare wages mainly occurs in small and micro enterprises, because they are rarely subject to tax inspections. The amount of money falsely declared for individuals is usually not large, only a few million per month, because if a few tens of millions are declared each month, the tax authorities will immediately notice and not everyone has such an income level.

To detect, according to the representative of the General Department of Taxation, it must be through an inspection, or if the taxpayer discovers that they have been exploited and reports it, the Tax Department will inspect and handle it. “Stealing someone else's tax code to falsely declare expenses, if discovered, will be punished for tax evasion, because falsely declaring expenses to reduce taxable income. The penalty level also varies based on the amount of falsely declared and the number of violations. This is an act of tax evasion, not false declaration,” Ms. Lan affirmed.

Deputy Director of the Ho Chi Minh City Tax Department Le Thi Thu Huong added that enterprises that declare additional employees but do not have them when compared to the list of social insurance payments will be excluded from reasonable expenses. Enterprises that intentionally falsely declare expenses will be administratively fined 20% of the falsely declared amount. If the false amount is large, the tax authority will transfer the case to the investigation agency to handle the crime of tax evasion. However, whether or not to prosecute is decided by the investigation agency. According to Ms. Huong, there are also cases where the company's accountant entered a wrong number in the tax code or ID card when settling taxes, so it was mistaken for another person, but it was not intentional.

According to Ms. Lan, it is very difficult to prevent tax evasion as mentioned above. Because personal information such as ID numbers can be obtained through many channels. "It is very difficult to prevent before someone is taken advantage of and reports to the tax authority. The tax authority mainly handles the case after it has occurred and prevents it to reduce the damage to the person being taken advantage of," Ms. Lan said. Ms. Lan admitted that the tax sector cannot inspect all operating businesses, so there are still businesses that are successful in taking advantage of other people's tax codes to falsely declare expenses to evade taxes.

It is known that the General Department of Taxation has directed tax departments that if there is a reflection from taxpayers about suspected exploitation, tax authorities must trace the source of expenditure to find the exploiting enterprise. From there, summon the enterprise to work and handle it.