VietNamNet Bridge – Businesses have to spend 500 hours a year on tax procedures, while individuals need to have 24 signatures to get a personal income tax refund, according to the General Department of Taxation (GDT).

Opinions still vary about the number of hours businesses have to spend every year on tax procedures. The World Bank, in its recent report, said it costs businesses 872 hours.  

The figure is four times higher than the average level in Asia Pacific and higher than most regional countries, including Indonesia (259 hours), Thailand (264 hours), the Philippines (193 hours), Malaysia (133 hours) and Singapore (82 hours).

It is also time consuming for workers to pay social, healthcare and unemployment premiums, estimated at 335 hours a year (workers have to make 12 declarations per annum).

It takes businesses 320 hours on the procedures related to the value added tax (VAT) and 217 hours on corporate income tax.

Meanwhile, Nguyen Thi Cuc, former deputy head of GDT, now Chair of the Tax Consultation Association, estimates that businesses have to spend one-third of their time, or four months a year, just to follow tax procedures.

GDT argues that in fact, businesses only have to spend about 500 hours on tax procedures a year, if not counting on the hours spent on social, healthcare and unemployment insurance procedures.

It also said the figures - 872 hours announced by the World Bank and 500 hours by GDT – both showed the great efforts made by taxation bodies in simplifying administrative procedures, noting that the figure was 1,050 hours some years ago.

However, Minister of Finance Dinh Tien Dung admitted that businesses are unsatisfied about the way taxation bodies work, complaining that in many cases they have to wait a couple of weeks or months go receive the answers from taxation bodies.

Dung also said 500 hours is overly high and that the time could be cut by a half to 200-300 hours.

Tuoi Tre quoted its sources as saying that 24 signatures of taxation agencies’ leaders are needed to fulfill the personal income tax refund for one individual.

The newspaper also quoted Tran Xoa, director of Minh Dang Quang law firm as commenting that it was unreasonable to require so many signatures for the personal income tax procedure.

A report of the HCM City Taxation Agency showed that in most cases, the values of tax claimed for refunding are very modest, while there are only a few claims for big money refunds. However, all taxpayers have to follow the same procedures. As a result, many workers, including current workers, have to wait a couple of weeks just to get tens of thousands of dong back.

Nguyen Thai Son, former head of the personal income tax division of the HCM City Taxation Agency, also thinks that it is unreasonable to require the same procedure for  workers who claim returns of tens of millions of dong worth of tax and those who just claim tens of thousands of dong.

Kim Chi