“For a Powerful Vietnam” Forum:

Barriers need to be removed for private businesses

In Vietnam’s history, whenever the economy develops, it is associated with the development of private businesses, and vice versa. Lawyer Truong Thanh Duc from Basico Law Firm writes for “For a Powerful Vietnam” Forum:

A businessman from Australia complained to me about personal income tax payment procedures. When he declared tax for the first time in Australia, he only needed to read the instructions and then fulfill the declaration immediately. But he could not do it here although he has been living here for years.

Barriers need to be removed for private businesses

As a consultancy lawyer, I usually see similar cases.

I work with laws and I read legal documents every day. I give advice to businesses and I get involved in the compilation of laws. However, I sometimes still find it difficult to interpret legal regulations.

For tax payment alone, Decree 129/2013 stipulates 50 behaviors subject to administration fines. In accounting, 90 behaviors are subject to fines under Decree 105/2013. A signature in the wrong position will be fined. In addition, there are risks of criminal offenses if one ore more violations related to invoices and vouchers are committed.

I read in the newspapers some days ago that nearly 100 percent of businesses inspected in tax payment were found violating rules on tax declarations and payments.

Businesses really don’t intend to make violations, because they would rather spend time on doing business. However, since regulations are too intricate, businesses still makr violations.

The Department of Construction Economics under the Ministry of Construction has found 20,000 construction norms which are outdated. The norms, which were built based on technologies present 30-40 years ago, still have not changed.

Taxation agencies accept the unit price of VND16,000 per square meter for ?screed?, but in fact, enterprises have to pay VND50,000. As a result, they have to ‘fabricate’ other expense items to legalize the costs.

The 2015 Penal Code mentions 59 crimes subject to full or partial asset confiscation, an increase of 41 crimes compared with the 1999 Penal Code. Of these, asset seizure is applied to 16 out of 46 offenses for infringing upon economic management order.

 

As such, the assets of someone will be confiscated if he defrauds others of VND2 million and more, or if he is found abusing credit to appropriate assets worth VND50 million and more.

Such provisions are worrying. In principle, one only has to compensate for the losses he causes, and there is no reason to seize the assets which do not have relations to the crimes.

I asked many businesspeople if they know in which legal document the famous regulation ‘people and businesses can do all the things that are not prohibited by the laws, while the State can only do the things that the laws allow’ can be found.

They all affirmed the regulation is stipulated somewhere. But in fact, no legal document stipulates this.

The Constitution and the Civil Code (Article 2.2) stipulate civil rights, including the right to trade, and the right to do business, but they don’t mention the issues in details.

In the case of Grab, if the business model is not mentioned in the current laws, the enterprise must have the right to do its new type of business. But this is not seen in reality.

Vietnam now has over 500,000 businesses, a very modest figure if compared with the total population of 93 million.

In recent years, the number of newly registered businesses has been always higher than 100,000 each year. This shows the business sprit and the aspiration of getting rich of the Vietnamese people.

Therefore, I believe that Vietnam needs to remove the barriers that hinder the development of private businesses. Once the State, the institutional system and the laws become friendly, people will feel secure to make investment and do business. If so, the 10 percent GDP growth rate is within reach. 

Lan Anh

 
 

Other News

.
Taxing rental apartments: lessors and lessees will face difficulties
Taxing rental apartments: lessors and lessees will face difficulties
FEATUREicon  18/05/2021 

Imposing tax on the leasing of apartments and business premises is not a new idea, but the method of taxation remains controversial.

Multi-billion VND apartment buildings unoccupied in central Hanoi
Multi-billion VND apartment buildings unoccupied in central Hanoi
FEATUREicon  18/05/2021 

Many apartment buildings in Hanoi have been left idle for many years, even while many people seek accommodations.

Ben Tre takes different approach to change its fate
Ben Tre takes different approach to change its fate
FEATUREicon  18/05/2021 

“What should we do – continue to complain about difficulties to get subsidies from the state budget, or become self-reliant to rise up,” said Ben Tre Provincial Party Committee Secretary Phan Van Mai.

Old discarded clothes turned into expensive products
Old discarded clothes turned into expensive products
FEATUREicon  15/05/2021 

All old things, from clothes and guitars to motorbikes, can be recycled into useful and highly aesthetic items thanks to talented artisans.

Female scientist wants to start public awareness campaign about organ donations
Female scientist wants to start public awareness campaign about organ donations
FEATUREicon  16/05/2021 

Dr Do Pham Nguyet Thanh, born in 1995, an expert at the Biomedical Research Center under the Pham Ngoc Thach University of Medicine, has been honored as one of HCMC 2020 Outstanding Young Citizens thanks to her active contributions to the community.

Land price hikes stop, but property remains expensive
Land price hikes stop, but property remains expensive
FEATUREicon  15/05/2021 

Though land fever has eased, prices are still high. The apartments in projects in advantageous positions are being offered at sky-high prices of VND300-400 million per square meter.

Hanoi advised to follow Japan’s urban railway model
Hanoi advised to follow Japan’s urban railway model
FEATUREicon  16/05/2021 

The Tokyo-Tshukoba urban railway line was funded by converting land in 18 projects along the route. The land price in these areas soared from $1 per square meter to $5,000.

Covid-19 vaccine and the gap between countries
Covid-19 vaccine and the gap between countries
FEATUREicon  16/05/2021 

The US announcement to support the waiver of IP protection on Covid-19 vaccine has not been the good news that was previously expected.

9-year-old pupil becomes national master of chess
9-year-old pupil becomes national master of chess
FEATUREicon  14/05/2021 

At the age of nine, Hanoi’s Dau Khuong Duy has been granted the title national master of chess.

Phu Tho woman finds husband after 13-year absence
Phu Tho woman finds husband after 13-year absence
FEATUREicon  14/05/2021 

Thanks to a video posted on Tiktok, a woman in Phu Tho province has found her husband who was missing for 13 years.

The path for Vietnam to become owners rather than just wage earners
The path for Vietnam to become owners rather than just wage earners
FEATUREicon  17/05/2021 

Technology and innovation are the answers to the question about how Vietnam can to escape from doing only outsourcing for foreign partners.

Prime Minister sets strategic direction for information and communications sector development
Prime Minister sets strategic direction for information and communications sector development
FEATUREicon  14/05/2021 

Prime Minister Pham Minh Chinh, during a working session with the Ministry of Information and Communications (MIC) on May 11, assigned tasks and set strategic development goals for the time to come.

Steel manufacturer tries to revive after 10 years of being idle
Steel manufacturer tries to revive after 10 years of being idle
FEATUREicon  14/05/2021 

The expansion of the Thai Nguyen steel project has yet to be completed after 14 years. Several former managers of the Thai Nguyen Iron and Steel JSC (Tisco) have been sent to prison for wrongdoings related to the project.

Vietnamese enterprises lose their home market as they focus on land deals
Vietnamese enterprises lose their home market as they focus on land deals
FEATUREicon  15/05/2021 

Many enterprises would rather use their capital to buy and sell land than make investments to scale up their production.

Poor people lose chance to buy houses with funds from gov't preferential credit package
Poor people lose chance to buy houses with funds from gov't preferential credit package
FEATUREicon  13/05/2021 

As the VND30 trillion preferential credit package has ended, many realtors and clients have fallen into a difficult situation.

Brother-sister pair wins Asian championship in skating
Brother-sister pair wins Asian championship in skating
FEATUREicon  13/05/2021 

Falling passionately in love with ice dancing in childhood, the skating siblings Minh and Chi could not imagine that the sport would ever bring such honors to them.

With over US$1 billion, a new Vietnamese billionaire is revealed
With over US$1 billion, a new Vietnamese billionaire is revealed
FEATUREicon  13/05/2021 

The assets of the richest people in Vietnam have risen sharply in recent times. Many tycoons have earned huge recently.

Lessons from the Covid-19 'tsunami' in India
Lessons from the Covid-19 'tsunami' in India
FEATUREicon  12/05/2021 

Proactively protecting yourself, going out only when absolutely necessary, fulfilling medical declarations, strictly following the 5K message, and installing the Covid-19 tracking app Bluezone are the best ways to prevent the spread of Covid-19. 

Land fever: speculators spread rumors to push prices up
Land fever: speculators spread rumors to push prices up
FEATUREicon  12/05/2021 

Land prices recently soared by VND30-50 million per square meter in some places, but the number of successful transactions was modest.

Vietnam’s pho sold under Chinese brand, fish sauce marked with Thai brand
Vietnam’s pho sold under Chinese brand, fish sauce marked with Thai brand
FEATUREicon  12/05/2021 

Vietnam’s ST25 rice is at risk of having its brand stolen in the US and Australian markets. Losing brands is the heavy price that Vietnamese enterprises will pay for their inappropriate attention to trademark register.

 
 
 
Leave your comment on an article

OR QUICK LOGIN