2021 tax extension policy is more flexible and specific


2021 tax extension policy is more flexible and specific
Nguyen Thi Cuc, Chairwoman of the Vietnam Tax Consultants’ Association.

The Government recently issued Decree No. 52/2021/ND-CP providing the extension of tax and land rent payment deadlines for businesses, organizations, household businesses, and individual businesses that are adversely affected by the Covid-19 pandemic. How do you evaluate the content of this?

In 2020, to deal with the difficulties caused by the Covid-19 pandemic, the Government issued Decree 41/2020/ ND-CP and Decree No. 109/2020/ ND-CP to reduce, expand and extend tax and land rental payment deadlines. The amount of extended tax and rent payment and the number of businesses enjoying this policy are relatively large. Such tax incentives are very useful for businesses.

Although it seemed that Covid-19 had been under control in the first months of 2021, the disease broke out again in Hai Duong and 12 other provinces and cities.

At present, the pandemic once again impacted the production and business situation of enterprises.

According to Decree No. 52, with the policy of tax payment extension, the total extended tax and land rental amount is expected to be VND115,000 billion. It means that the total state budget revenue in the extended months will be reduced by VND115,000 billion.

Thus, the enterprises are once again supported by the State, the tax amount which supposed to be paid can be reinvested in production and business activities.

A number of provisions in Decree No. 52/2021/ND-CP are amended compared with Decree No.41/2020/ND-CP which also stipulated the extension of tax payment deadline in 2020. How do you assess this amendment?

In Decree No. 52/2021/ND-CP, the extension time is more detailed, more specific and consistent with deadlines of types of tax on the basis of the principle that regardless of extension, the budget year of 2021 and the fiscal year shall not be later than this year, so the deadline is by December 31, 2021, the enterprise must submit all to the State budget.

For example, Decree No.41/2020/ND-CP only provides a 5-month extension for Value Added Tax, if it is more than five months, the following months will not be extended. But the extension is regulated more flexibly in Decree No.52/2021/ND-CP.

For example, from March to June, the deadline to declare value added tax is the 20th day of the following month. At this point, the enterprise can apply for tax extension. Then, the extension will be flexibly implemented with the longest extension period of five months until the deadline of December 31, 2021.

If the enterprise declares and submits the VAT extension document from July, then the allowed tax extension is four months. If the declaration is made in August, the tax extension period is three months, so that the deadline is still December 31, 2021.

The extension for Corporate Income Tax is also a little different. The extension applied for the provisional corporate income tax for the first quarter and the second quarter in 2021 is three months. Particularly for land rent, the extension is six months.

In fact, many businesses do not pay attention to extensions of deadlines for tax and land use fee payment. In your opinion, what should the tax agency do to help businesses and people know and not to miss benefits?

In order for enterprises to know and proactively apply for the extension, this Decree clearly stipulates the extension procedures, which are very convenient. But we think that a number of businesses do not know about the extension stipulated Decree No.41/2020/ND-CP.

Therefore, it requests that the tax agency should not only publicize on mass media, but also send emails to businesses so that if they are eligible for the extension, they will apply.

If so, the policies of the Government will be effective, avoiding the situation that despite the policy, some businesses do not know or only know when it is too late and lose their benefits.

Thank you!

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