Japan's experience in tax debt collection

Editor's note:Nghe An Newspaper would like to publish an article by Mr. Nguyen Hong Hai, Deputy Director of Nghe An Tax Department, during his visit and study trip to Japan.

(Baonghean) - The Japanese Government and Ministry of Finance do not assign tax revenue estimates to the General Department of Taxation. The tax system is arranged by region and is not affected by administrative boundaries. Tax collection only complies with tax laws and actual business results and income of Japanese people.

Japan's current tax policy and system have been maintained (and even innovated) for nearly 119 years. The law gives tax officials full authority to collect taxes according to "traditional Japanese culture". Therefore, Japan's tax administration also has Japanese cultural characteristics: very advanced but very conservative; very scientific but accepting the reality of some unscientific steps; very democratic but very resolute and "dictatorial" when dealing with people who do not comply with tax laws.

According to the information you exchanged, a few years ago the tax debt situation in Japan was even more tense than in Vietnam today, businesses had a lot of debt, were overdue, and had no ability to collect... However, they have applied "typically Japanese" measures in a drastic manner, now tax evasion and large tax debts almost do not occur.

With the human resources of the Tax sector being almost equal to ours, to do a good job of tax management, they have relatively good solutions. For example, they concentrate human resources and tax management resources on businesses with very strict regulations on what level of business they must establish a business... They advocate "letting go" of individual business households in the direction of propaganda and support for business households to self-declare and pay taxes. According to your information, this tax sector also has revenue losses, but compared to the national level, it is not large.

The tax authorities only handle the typical "Japanese" heavy-handed, deterrent when detecting violations through the national data system or when there are complaints and denunciations. To learn about this issue, we went to 3 sports equipment stores and used tax procedures to test them: "I am a foreign tourist, I do not take sales invoices, can you give me a discount?". They replied: "Taking invoices or not, it does not matter! If you want to get a refund of 8% consumption tax (similar to VAT in our country), you cannot get a discount because we have to enter all sales information into the computer. If you want a discount, you have to pay in cash and do not go through the consumption tax refund procedure." I asked how many % the discount was, they replied 20%.

The quick-witted interpreter introduced me to the Japanese tax collectors in Vietnam. Suddenly, their faces changed, and they said they did not like to be friends with tax officials. This person complained, telling the story of how the Japanese tax officers were “very cruel.” It was hard for those who were late in paying their taxes when the time came for enforcement, as their houses were searched and their assets confiscated. The police and the prosecutor’s office searched houses and arrested people, but when they returned from prison, they still had a house to live in. But when the tax officers searched their houses, they dug up the floors, walls, bathtubs, and even broke open the TVs and refrigerators… after the search, it was “as desolated as a tsunami.”

In Japan, they deploy information technology applications in a synchronous and unified manner: All government data, citizen data, business data, and tourist data to Japan are updated into a "national data" system that is shared by all sectors, from the government to the people. They do not use many "separate" application software for each sector, each field, each locality like we do.

"A hundred hearings are not as good as one seeing", thanks to the "national data system", the procedure for refunding consumption tax for foreign customers by Japanese businesses is "lightning fast", only about 3-5 minutes to complete. If the total payment of the buyer is over 10 thousand yen (equivalent to 1.8 million VND), they ask to present the passport to be scanned into the reader like scanning a credit card on the page with the photo and characters, immediately the buyer's information is displayed on the computer: Full name, nationality, date of arrival in Japan, time in Japan, amount of cash carried with Customs declaration... and with just one simple operation, the refund amount is immediately deducted from the amount the customer has to pay.

Another thing we also "saw with our own eyes and heard with our own ears" is that the Japanese Tax Administration has applied relatively good tax payment urging measures that can be applied in Vietnam. For example, at regional tax offices, they have a "Telephone Tax Urging Center", where tax debtors will be reminded continuously through an automatic switchboard system called by transaction officers throughout the day until there is a commitment to pay taxes.

When the taxpayer picks up the phone, the “data system” will automatically display the tax information of the business on the screen for the transaction officer to use. If the commitment is overdue, the tax officer will automatically switch to tax enforcement… and most importantly, Japanese law allows tax officers to have full authority to act “Japanese style” as prescribed by law, to collect tax money into the State budget.