Cases eligible for extension of tax debt payment deadlines

Extension of tax debt payment deadlines may be granted to operating enterprises that owe tax debts due to financial difficulties and business losses for three consecutive years (2005-2007), including:

a/ Enterprises that were unable to fully pay arising tax amounts on time because they had to relocate their business places out of inner cities under the planning of the Government or provincial-level People's Committee and faced losses in production and business activities during the time of relocation to new business places.

b/ Enterprises that were unable to fully pay arising tax amounts on time because of business risks and financial difficulties, such as their business partners went bankrupt, debts could not be collected, the market was lost due to policy change in importing countries, losses were incurred due to natural disasters, accidents or other force majeure reasons.

c/ Enterprises that directly signed contracts with project owners or enterprises to implement projects or works funded with state budget or the Government's ODA funds but have not yet received payments or allocations from the state budget, so had no sources for paying debts, resulting in tax debts.

d/ Enterprises that implemented infrastructure or housing or land business investment projects but have not yet been allocated or leased land by the State, or land use rights auctions have not yet been held by the State, and therefore could not clear up grounds or receive land, resulting in no sources for making payments to the state budget. Their tax debts shall be handled as follows:

-  For projects which could not be started on schedule under Clause 1, Article 37 of the Government's Decree No. 84/2007/ND-CP of May 25, 2007, because grounds could not be cleared or land had been handed over (including partial hand-over according to the land allocation schedule) but projects were not executed and competent agencies have issued decisions to recover their land, provincial-level Tax Departments shall re-determine amounts payable to the state budget suitable to the actually allocated or leased land areas. Project-implementing enterprises shall immediately pay arising tax amounts according to the notices of tax agencies.

-  For projects which were implemented behind schedule and the land use deadline has been extended by management agencies competent to allocate or lease land under Clause 2. Article 37 of Decree No. 84/2007/ND-CP of May 25,2007, and have tax debts and state budget remittances that are related to land and the transfer of land use rights, houses or infrastructure on land, they shall be considered and permitted to extend the deadline for paying tax debts corresponding to their land areas for which the land use deadline has been extended.

Time of extension and tax amounts eligible for payment deadline extension

- Enterprises facing financial difficulties mentioned at Points a. b and c. Clause 1 of Section

I above may be considered for extension of me deadline for fully paying tax debts for not more than one year, counting from July 1. 2007.

- Enterprises defined at Point c, Clause 1 of Section I above may be considered for extension corresponding to the time and tax debts owed due to non-receipt of state budget payments, with the extended lime not exceeding one year, counting from Jury 1,2007.

During the extended time for tax debt payment in the above-mentioned cases, fines are not imposed for the late payment of tax amounts for which the payment deadline is extended. After the extended time, if enterprises fail to fully pay tax amounts for which the payment deadline has been extended, tax agencies or customs offices shall impose fines for late payment and take coercive measures to collect tax debts in accordance with law.

Procedures and dossiers for extension of tax debt payment deadlines and competence to decide on such extension

a/ Procedures and dossiers for extension. including;

- A written request for extension of the deadline for paying tax debts and fines, made according to form No. 02/NOPT, issued together with the Finance Ministry's Circular No. 60/2007/TT-BTC of June 14. 200". guiding the implementation of a number of articles of the Law on Tax Administration and the Government's Decree No. 85/2007/ND-CP of May 25,2007, which details the implementation of a number of articles of the Law on Tax Administration. This written request must clearly state the reason for requesting extension, the tax and fine amounts for which extension of the payment deadline is requested, the requested extension time, the plan for tax debt payment, and a commitment to pay tax and fine amounts according to this plan.

- Documents proving the reason for requesting extension. Specifically in the following cases:

+ The financial statement of the nearest fiscal year ending before July 1, 2007 and a table of data on the tax debt as of July 1, 2007.

+ In case of meeting business risks: If business risks are caused by natural disaster, fire or accident, a written record of the extent or value of property damage made by a competent body such as the valuation council set up by the provincial-level Finance Service or a professional valuation company providing valuation services under contracts or the valuation center of the provincial-level Finance Service, is required. If business risks are caused by a bankrupt partner or a policy change in the importing country, the enterprise shall produce a proof or give explanations.

+ In case of relocation of business places at the request of a competent state agency, the decision of the competent state agency on the relocation of the enterprise's business place is required.

+ For business establishments with turnover from the implementation of projects paid from the state budget which have not yet received such payments, the evidence documents include the economic contract, a debt comparison statement and the certification of the completed work volume for which payment is accepted, made by the investor or principal contractor; documents and vouchers proving the realized turnover and the turnover amount already paid from the state budget, and documents showing the payable tax amount based on the realized turnover or completed work volume, and the tax debt.

+ For enterprises implementing investment projects to build infrastructure or houses for commercial purposes which faced difficulties: vouchers and documents showing the payable, paid and owed tax amounts; document permitting the extension of the land use deadline issued by an agency competent to allocate or lease land; and a declaration of the sale of houses and the transfer of land use rights (turnover and area), are required.

The above documents must be notarized copies or copies appended with a true copy stamp and the signature of a competent person of the enterprise.

Tax debtors shall send dossiers of request for extension of tax debt payment deadlines to tax administration agencies that directly manage them.

b/ Competence to settle and time limit for settling requests for extension of tax debt payment deadlines

Tax administration agencies that directly manage tax-owing enterprises, business establishments or individuals (below collectively referred to as tax debtors) shall receive and process dossiers of request for extension of tax debt payment deadlines according to their competence, current law and the guidance in this Circular.

Within 10 days after receiving complete dossiers, tax administration agencies shall issue replies to tax debtors. For incomplete dossiers of request for extension of tax debt payment deadlines, they shall, within 3 working days after receiving the dossiers, notify such to the tax debtors for completing the dossiers.

For tax debtors eligible for extension of tax debt payment deadlines, the head of the tax administration agencies directly managing the tax debtors shall issue a document approving the request for extension of the tax debt payment deadline (according to form No. 03/NOPT issued together with Circular No. 60/2007/TT-BTC of. June 14, 2007). If rejecting a request, the tax administration agency shall issue a written reply stating its rejection to the tax debtor (according to form No. 04/NOPT issued together wilh Circular No. 60/2007/TT-BTC of June 14,2007;

Particularly for tax debts of exports or imports for which customs declarations were registered on or before January 1, 2007, which fall into the cases guided at Point 1 of this Section, dossiers of request for extension of tax debt payment deadlines and the competence to grant such extension comply with the guidance in the Finance Ministry's Circular No. 59/2007/TT-BTC of June 14, 2007, guiding the application of import and export taxes and the tax administration of imports and exports, and documents amending, supplementing and replacing this Circular (if any).

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