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Tax evasion of over VND100 billion - Nguyen Kim Trading Joint Stock to be suspended from business

Tax evasion of over VND100 billion - Nguyen Kim Trading Joint Stock to be suspended from business

Thursday 17, 10 2019
On July 16, The Tax Department of Ho Chi Minh City has asked 18 banks to block 26 trading accounts of Nguyen Kim Trading Joint Stock Company to recover tax arrears of nearly 150 billion VND to the State Budget.
On July 16, The Tax Department of Ho Chi Minh City has asked 18 banks to block 26 trading accounts of Nguyen Kim Trading Joint Stock Company to recover tax arrears of nearly 150 billion VND to the State Budget.

Arccording to Ho Chi Minh City Tax Department, to the last date 13/07, Nguyen Kim has only transfer to the tax account 3 billion dongs on the total amount of 150 billion dongs of tax debt. Therefore, some sanctions is already used to collect the tax arrears as freezing accounts, preventing using invoices. According to Ms. Ly Thi Hoai Huong - Deputy Director of Personal Income Tax Management, General Department of Taxation, Nguyen Kim Trading can be suspended from business if not complete the tax arrears.

The whopping sum includes VND104.74 billion (US$4.5 million) in personal income tax arrears, a VND19.41 billion fine for administrative violations and another VND24.18 billion penalty for late tax payment, according to the HCM City tax department.

 
Last year, the employees of Nguyen Kim authorised the company to settle the tax bill but Nguyen Kim dodged the payment of personal income tax for its executives and employees by shifting its employees’ salaries and bonuses to allowances and overtime payments.

Under the Vietnamese personal income tax law, the disparity between overtime pay and regular pay is considered non-taxable income.

By applying this trick, Nguyen Kim could significantly reduce the amount of tax its employees paid, especially the highly-compensated employees.

Legally, if Nguyen Kim disagrees with the sanction, the firm can file complaints to authorities at a higher level, meaning the General Department of Taxation, as well as can initiate lawsuits in administrative court if they see such a penalty as unreasonable.

Nguyen Kim has 10 business days to clear the hefty VND150 billion fines and back taxes, starting from June 29 when the municipal tax department issued the sanction decision.


 
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Business

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