The reason why the Ministry of Finance wants to collect taxes as soon as shareholders receive stock dividends

(Dan Tri) - The Ministry of Finance believes that many shareholders have not transferred their shares immediately after receiving dividends in the form of securities or have no need to transfer them, while their assets are constantly increasing.

In the Draft Decree amending and supplementing a number of articles in Decree 126 detailing a number of articles of the Law on Tax Administration, the Ministry of Finance believes that it is necessary to clearly stipulate the time for deduction and declaration of tax on income from dividends and stock bonuses to limit policy abuse and prolong the time for tax obligations.

This agency proposed that personal income tax must be deducted, declared and paid immediately at the time of receiving dividends and bonuses in securities, instead of waiting until the securities are sold. The issuing organization is responsible for deducting and paying taxes on behalf of individuals.

In fact, dividends and profits are being paid in many forms such as cash, securities, or capital increase. Of which, cash dividends are deducted by the paying organization, declared and paid tax for individuals and have been applied effectively and smoothly in the past time.

However, for income from dividends and bonuses paid in securities, investors only have to pay tax when selling or transferring those shares, not immediately when receiving dividends.

The Ministry of Finance believes that this regulation is inconvenient, mainly because many individuals who receive dividends and bonuses in the form of securities do not need to transfer shares or capital for a long time. This helps investors (especially large shareholders and strategic shareholders) not have to declare and pay taxes immediately at the time of income, while assets and income are constantly increasing.

Therefore, when an individual receives dividends (regardless of cash or securities), it is considered income (without having to wait until the securities are transferred and cash flow is generated).

Many shareholders have not transferred immediately after receiving dividends in the form of stocks (Illustration: Dang Duc).

According to the Ministry of Finance, in the period 2016-2024, individuals receiving dividends in the form of securities and individuals who are existing shareholders receiving bonuses in the form of securities received a total of 34.84 billion shares.

If all of these shares are transferred and the share price is calculated at par value (VND 10,000), with a tax rate of 5%, the estimated personal income tax to be declared and paid is about VND 17,420 billion.

However, in reality, according to the Ministry of Finance, the amount of personal income tax from the income of individuals receiving dividends in securities and existing shareholders receiving bonuses in securities declared in the above period is only about 1,318 billion VND, accounting for nearly 8% of the estimated 17,420 billion VND mentioned above (if all of these shares are transferred).

Also according to statistics from this ministry, in the period of 2016-2024, the total amount of personal income tax declared from capital investment activities reached 51,965 billion VND, of which tax collected from dividends and bonuses paid in securities was only about 1,318 billion VND, accounting for 2.54%.

Source: https://dantri.com.vn/kinh-doanh/ly-do-bo-tai-chinh-muon-thu-thue-ngay-khi-co-dong-nhan-co-tuc-chung-khoan-20250701004928914.htm