State employees try to fend off tax for extra incomes

Read the original news 

VietnamNet English - 39 month(s) ago 3 readings

State employees try to fend off tax for extra incomes

VietNamNet Bridge – The price escalations have forced state employees to fasten their belt and seek additional incomes from extra jobs. However, they now tend to become self-employed to evade tax instead of acting as hired workers for other agencies or companies.

One year ago, Hoa, an IT officer of a state agency, collaborated with many press agencies. She wrote stories about the issues relating to the IT industry for which she got royalties. Since Hoa is an expert and she has deep knowledge about the field, she was really well paid, about one million dong for an article.

The royalties came regularly one in every several weeks, and they were considered as the current incomes, for which Hoa had to pay personal income tax. Hoa always had her income from the articles withheld by 20 percent, because Hoa still did not have a tax code.

However, Hoa does not take this job any more. Instead of writing articles and paying tax, she has decided to open a lemon tea shop which aims to serve students.

“I go to the office in daytime and I open my shop in the evening. I can earn several hundreds of thousands of dong from my shop, while I do not have to pay any kind of tax and I do not have to follow complicated procedures for tax refund,” she said.

It has become popular that office workers use office hours to make trade, join scientific research team, write for newspapers, and work as insurance brokers or sellers to earn extra incomes. Most of the incomes are considered as current incomes which have to bear taxation.

However, since the prices have been escalating, many of them tend to take manual works or become self-employed to avoid tax.

Vinh, an officer of a construction worker in Xuan Dinh district in Hanoi, feels happy that her house is located near a printing workshop, which allows her to take a good extra job. Every evening, she binds books for the workshop for which she earns about two million dong a month.

Vinh said that if she joins the teams of making scientific research, she would also be able to earn extra money, but she will have to pay tax for the incomes. Therefore, she has decided to take the simple manual work.

Hong, a saleswoman at a supermarket, has also decided to sell pickled vegetables. The vegetables are sold to the local residents which can bring some tens of thousands of dong a day.

“I just have to buy materials and then preserve vegetables in salt. The vegetables will be sold by mother who takes cares for the grandson and sells vegetables at the same time,” Hong said.

“I do not have big capital, so I accept to work as a pretty trader,” she explains.

She went on to say that she is not considered as “business household”, therefore, she is not taxed. “When management officers come, I would hide my sale items,” she said.

Meanwhile, Hang, an office worker, has become the supplier of rice, vegetable and food supplier to local residents. Hang comes from Hai Hau, a big rice granary. Therefore, Hang can easily collect rice from farmers in the home village and supply to the residents in Hanoi.

Hang once stayed late at the office to translate documents for money. However, since the government decided that state employees’ salaries must be paid via bank accounts, her income has become transparent, and she has to pay personal income tax.

“My relatives provide car and motorbike keeping services and they do not have to pay any dong in tax, because the taxation bodies cannot count on their incomes. So I have also decided to follow them,” she said.

A high ranking officer of the General Department of Taxation said that the taxation body has received a lot of complaints about the taxation on the current incomes worth 500,000 dong and more. He has revealed that the Ministry of Finance is considering raising the threshold of current incomes for taxation from 500,000 dong to one million dong.

Kim Chi

There is no comment

Please Sign up or Login to comment.

Top page