After a period of working in HCM City, Nguyen Binh decided to return to Quang Binh, his hometown. He said he has a personal income tax refund but doesn’t know when he will get the money.

In order to get tax refunds, he has to return to HCM City and follow administrative formalities at the city’s tax agency. He complained that the procedures burden both taxpayer and tax officers.

“I believe that tax refund is the thing taxation agency must do to ensure people’s interests. And the refund clearly is mine, so I don’t have to ask ‘to grant a favor’ to give money back to me,” he said.

Two months ago, VietNamNet published an article about a woman, Q.P, who complained that she was tired of the procedures to get a tax refund.

P said she submitted dossiers for tax refund in April, but she still could not get the money by the time the article was posted (August 2024). 

The problem was that P’s so ho khau (household registration book) shows that she lives in HCM City, but her registered temporary residence address is in Thanh Xuan district in Hanoi, and the four agencies from which she received incomes are located in three districts of Hanoi – Dong Da, Thanh Xuan and Long Bien. 

A representative of Thanh Xuan district taxation agency on September 29 informed VietNamNet that after the article was published on VietNamNet, the taxation agency contacted the taxpayer and helped her to follow procedures to get a tax refund. After fulfilling procedures, the taxpayer got the tax refund of VND12.9 million.

P confirmed with VietNamNet that she got the tax refund after a lot of effort.

On September 17, she checked the taxation information system and found the tax refund of over VND12 million for her. However, she still had to submit a lot of documents as guided by a tax officer, and it was a long process.

On September 18, the dossiers for a tax refund were accepted by taxation agency.

On September 20, the decision on accepting the dossiers for tax refund was made. On September 24, she received the decision on tax refund and the amount of money of VND12.9 million.

On September 27, the tax refund was transmitted to the taxpayer’s bank account.

As such, the woman needed five months to get tax refund, and though taxation agency assigned a tax officer to support P after her case was reported on VietNamNet, she still needed to wait 22 more days to get money.

While people would be punished if they are slow in paying tax, taxation agency remains ‘innocent’ if it is slow in issuing a tax refund.

Nguyen Cong Tam, a taxpayer in Hanoi, said he has been advised to use a tax refund claim service. On social networks, service providers commit to get personal income tax refund within 6-40 days after the day of dossier submission, at a service fee of VND800,000.

Meanwhile, other service providers quote a ‘dossier preparation package’ of VND8-10 million, plus a ‘tax refund service fee’ which is 3-12 percent of total tax refunds.

However, Tam still doesn’t dare use the service which is illegal.

Automatic tax refund

In recent years, GDT has repeatedly affirmed that ‘taxpayers are put at the center of the taxation agency service and that it has applied high technology (eTax Mobile – the electronic taxation system, Big Data and AI) to create most favorable conditions for taxpayers to fulfill their tax obligations.

However, automatic tax refunds still have not been applied and taxpayers still have to spend much time to get tax refund. Many taxpayers even accept to lose money rather than follow complicated procedures to get money back.

Pham Quyen, a taxpayer in Hanoi, said she cannot understand why the taxation agency doesn’t refund tax automatically after its information system displays all the information about citizens’ incomes, sources of income and the amount of tax to be refunded.

Dinh Trong Thinh from the Vietnam Financial Consultancy Association said in many other countries, tax calculations and tax refunds have been carried out automatically for years.

There are many reasons why the automatic refunding regime still cannot be applied in Vietnam, including problems in the legal framework, an insufficient database, and especially, changeable tax policies.

Binh Minh