Tax conversion for business households needs to be 'correctly collected, fully collected, and easy to implement'

Creating tax transparency in the digital economy .

According to lawyer Vu Van Bien ( Hai Phong City Bar Association), the shift in tax policy for business households from the lump-sum tax method to the declaration method is not only an inevitable trend but also an urgent requirement in the context of the digital economy reshaping all commercial activities in the market.

In reality, the digital economy is generating millions of transactions every day, with many activities no longer taking place in person but shifting to e-commerce. Continuing to rely on the traditional lump-sum tax model, which heavily depends on manual surveys and subjective revenue investigations, makes it difficult for tax authorities to control actual revenue collection, leading to budget losses. At the same time, this practice inadvertently creates an inequality gap between businesses that pay low lump-sum taxes and those that conduct transparent revenue reporting.

*The shift from lump-sum tax to declaration-based tax is a trend in line with the digital economy context. Photo: VGP*

The biggest problem currently lies in the fact that the lump-sum tax does not accurately reflect the scale and growth rate of revenue for many business households. Some households experience significant revenue growth thanks to online sales, but their lump-sum tax remains unchanged, while others whose businesses are slowing down still have to pay a higher lump-sum tax than is actually necessary. This lack of consistency leads to taxpayer dissatisfaction and makes it difficult for tax authorities to accurately assess management risks.

"Switching to a declaration mechanism supported by electronic invoices, POS machines, cashless payments, and digitized data will help the State closely monitor revenue. This is also a way to move towards transparency in tax obligations, combat fraud, and ensure fairness among businesses in the same industry and in the same area," lawyer Vu Van Bien emphasized.

Legal expert Vu Van Bien believes that this transition process must be carried out with clear, transparent, and easily understandable principles, without creating a burdensome bureaucratic hurdle for the people. Small-scale businesses urgently need detailed guidance, simplified procedures, and technological support.

Supporting household businesses in filing taxes simply and effectively.

According to legal expert Vu Van Bien, for the transition from lump-sum to declaration-based tax to be successful, tax authorities need to set the goal of "collecting correctly, collecting fully, and easily implementing." The first foundation is to build a clearer legal mechanism regarding the criteria for classifying business households.

Determining who is required to declare their assets should be based on transparent criteria such as revenue thresholds, workforce size, industry specifics, and frequency of electronic transactions. These criteria must be quantified and applied uniformly nationwide to avoid inconsistent practices in different localities.

*Tax officials assist business owners in filing tax returns transparently. Photo: Phan Chau*

In terms of implementation, tax authorities need to be more proactive in supporting household businesses in using digital tools. First, the declaration process needs to be simplified with streamlined, easy-to-understand forms, focusing on core indicators. The electronic declaration system must be intuitive, with step-by-step instructions, especially for older households with limited exposure to technology.

Secondly , support for electronic invoices and payment tools is crucial. When transaction data is digitized, revenue will reflect reality more accurately, no longer relying on manual verification. Tax authorities should waive or reduce the cost of using electronic invoices in the initial phase and provide free POS machine installation support for businesses that need it. This will reduce financial pressure and help people adapt more quickly.

Thirdly, instead of just communicating regulations, tax authorities should create direct and continuous support channels by establishing hotlines, mobile advisory teams, and providing guidance at markets and residential areas. When people understand and know how to comply, tax filing will no longer be a source of worry or a feeling of being "made a fool of."

Furthermore, tax authorities must prioritize transparency and internal control. All information regarding estimated revenue, evaluation criteria, and tax rates must be transparent from the outset to avoid complaints and build consensus with the public.

"The shift to tax declaration is not aimed at increasing taxes but at collecting taxes based on actual business activity. When revenue is automatically recorded, many households will see benefits such as easier financial management, easier access to bank loans, easier business expansion, and deeper participation in the digital market," lawyer Vu Van Bien emphasized.

According to lawyer Vu Van Bien, to realize the policy of shifting from lump-sum tax payment to declaration based on actual revenue, the Ministry of Finance is drafting a Decree regulating the declaration, calculation, deduction, and use of electronic invoices for business households and individual businesses. This is the first time a separate decree has been developed for this group, distinct from the general framework of the current Tax Administration Law. The new draft Decree not only addresses the shortcomings of the lump-sum tax method but also lays the foundation for modernizing tax management, enhancing the responsibility of business households, and increasing budget revenue efficiency.

Source: https://congthuong.vn/chuyen-doi-thue-voi-ho-kinh-doanh-can-thu-dung-thu-du-de-thuc-hien-433780.html