More firms inspected for transfer pricing
By Hong Phuc - The Saigon Times Daily
HCMC – Vietnam’s tax authorities last year inspected 1,276 enterprises suspected of transfer pricing, or ten times as many as the inspections done in 2010.
In 2011, tax authorities focused on inspecting enterprises with big losses, or losses exceeding equity but still expanding businesses, said the report of the General Department of Taxation.
In such inspections, the inspectors disclaimed the losses of VND4.4 trillion, as well as collected tax arrears and penalties worth VND1.65 trillion, or four times higher than that in the preceding year.
According to the report, most inspections against transfer pricing were launched in Hanoi, HCMC, Binh Duong, Lam Dong, Thanh Hoa, Quang Ninh, Bac Ninh, Khanh Hoa, An Giang, Vinh Phuc, Ba Ria-Vung Tau, Gia Lai and Ha Tinh.
“The inspection result has had positive effects on enterprises’ auditing, accounting and price declaration,” said the report sent to the Ministry of Finance.
Overall, above 45,900 enterprises were inspected last year, including 1,276 enterprises suspected of transfer pricing mentioned above, and imposed some VND7.6 trillion as penalties, said the 2011 report of the tax department.
The tax authorities said it would focus on tax management of big enterprises and key commercial banks in 2012. The inspection result will give advice to the finance ministry and relevant agencies on making macro policy, especially at a time when State-owned enterprises and banking system are being restructured.
In addition, this year’s inspection plan will focus on enterprises suspected of transfer pricing, loss-making businesses, those with large tax liability, and those who have not been inspected for years or are enjoying preferential tax policies. The main fields to be inspected will be banking, drug, property, power, petrol and oil, post and telecommunications, and mineral.
Under the quick report and the preliminary estimate of the department, over VND13.3 trillion of tax payment was exempted, reduced and extended in 2011. Particularly, the corporate income tax extended in 2011 was some VND9.4 trillion.
Tax exemption, reduction and extension is expected to reach VND5.4 trillion this year, in which some VND3.25 trillion of corporate income tax will be extended.