"Every morning I buy vegetables from the farmers, tofu from a family in the village, and on many days I buy fish that they've just caught from the stream and brought to sell. They are all small-scale producers, selling directly to me. There are no invoices to issue," he recounted.
According to the owner, he fully supports transparent business practices and is ready to fulfill all tax obligations to the State. However, in reality, many of the restaurant's ingredients are purchased from farmers and small-scale producers.
"If the seller doesn't have an invoice, where am I supposed to get one to declare?" he asked. However, the owner said that, fearing legal violations, he had laid off four of his five employees. The beer quán is now only operating at a minimal level.
The question posed by the beer shop owner turns out to be the question of millions of business owners. Many are struggling with a problem: they need invoices to file tax returns, but the input invoices simply don't exist.
A recent survey by VCCI (Vietnam Chamber of Commerce and Industry) shows that approximately 71% of business households face difficulties in gathering information to issue invoices; nearly 68% have trouble accounting for expenses; over 63% have difficulty understanding tax regulations; and about 62% are confused when filing tax returns.
Their concerns extend beyond tax obligations to include the time required to learn new regulations, the cost of hiring an accountant, investments in software and equipment, and the risk of penalties for incorrect declarations.
Behind those dry statistics lies a reality: what deters many businesses is not the tax obligation, but the obligation to comply.
For many business owners, taxes are just a payment they have to make, but what's far more concerning is what they have to spend to pay those taxes.
Mr. Nguyen Van Phung, a senior tax expert, commented that most household businesses in Vietnam "rely on labor for profit." The household owner handles sales, inventory, cashier duties, and store management all at once. They only have time to handle bookkeeping at the end of the day.
"Therefore, when designing tax policies, compliance costs are always a factor that needs to be taken into account," he said.
Invoices are "broken" right from the wholesale market.
Many people believe that simply equipping themselves with cash registers, accounting software, or electronic invoices will solve the problem.
But stepping outside the legal texts and looking at the transactions that take place every morning at the wholesale market, the story is quite different.
In reality, a significant number of input transactions for household businesses originate from areas where it is almost impossible to obtain invoices from the outset.
According to the General Statistics Office, in 2025 Vietnam will still have approximately 3.8 million people engaged in self-production and self-consumption, of which 88.4% live in rural areas, nearly 64% are women, and over 61% are 55 years old or older.
In addition, the country has more than 8 million households whose main production is agriculture, forestry, and fisheries. These are people who grow vegetables, raise chickens, make tofu, engage in small-scale fishing, or sell agricultural products directly to restaurants, food stores, and businesses.
When the initial links in the supply chain were still primarily household-scale operations, it was difficult to expect every transaction to immediately have complete invoices and documentation as in the corporate sector.
Therefore, if tax policies are designed solely based on business logic without considering the characteristics of the individual business sector and small-scale agriculture , compliance costs are likely to increase significantly.
According to calculations by Dr. Le Duy Binh, the household business sector currently comprises approximately 5.2 million households but employs only about 8 million workers, meaning an average of only about 1.5 workers per household. In other words, the majority of household businesses are essentially individuals or families who organize their own production and business activities, rather than enterprises with professional management and accounting systems.
According to calculations by the Vietnam Association of Small and Medium Enterprises, with approximately 1.77 million business households required to declare revenue based on the old threshold, compliance costs – including investment in cash registers, software, connectivity equipment, hiring accountants, time spent on procedures, and related expenses – could amount to 40-90 million VND per household per year.
Of course, this is just an estimate from the Vietnam Association of Small and Medium Enterprises and needs to be verified by independent studies. But even if the actual figure is significantly lower, the question remains: Is the cost of collecting one dollar of tax truly reasonable?
A tax policy not only generates government revenue. It also creates intangible costs that businesses must bear, from the time spent learning regulations, purchasing software, hiring accountants, to maintaining records and explaining errors. Regulatory agencies also have to invest in additional technological infrastructure, human resources, and monitoring costs to operate the system.
If the total social cost of collecting taxes is increasing, the effectiveness of the policy needs to be viewed from an economic perspective, not just a managerial one.
Transparency is the goal, but the path needs to be appropriate.
No one denies that the shift from lump-sum taxation to data-driven management and electronic invoices is an inevitable trend. A modern economy needs a more transparent and fair tax system that reduces revenue losses.
But tax reform isn't just about technological change. More importantly, it's about designing a mechanism that millions of businesses can implement at a reasonable cost.
If a restaurant owner has to cook, shop for groceries, sell food, and then at the end of the day has to learn accounting and complete tax procedures like a business, the compliance costs can easily become a bigger obstacle than the actual taxes to be paid.
The owner of the beer shop mentioned above didn't ask for a tax exemption, nor did he object to electronic invoices. The only thing he wanted to know was: "If the seller doesn't have an invoice, where do I get one?"
It's a very practical question, but it touches on the very core of the reform process.
A modern tax system should not be judged solely by the number of electronic invoices issued or the number of tax returns filed on time. More importantly, it must make millions of businesses feel that compliance is something they can do, rather than turning it into a burden that makes them apprehensive, confused, or seek ways to avoid it.
Therefore, if tax policies force them to follow the same accounting and reporting procedures as businesses, the compliance costs could easily exceed the capabilities of many small-scale household businesses.
Next phase: Simplifying procedures, increasing tax collection efficiency.
Source: https://vietnamnet.vn/toi-lay-hoa-don-o-dau-bay-gio-2531138.html
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