In which cases is tax evasion criminally prosecuted?

Pursuant to the provisions of Article 200 of the Penal Code No. 100/2015/QH13, amended and supplemented by Article 1 of the Penal Code No. 12/2017/QH14, the crime of tax evasion is criminally prosecuted.

9 tax evasion acts face prison sentences

A fine of VND 100 - 500 million or imprisonment from 3 months to 1 year will be applied to individuals who commit one of the 9 acts of tax evasion with an amount from VND 100 to less than VND 300 million, or less than VND 100 million but have been administratively sanctioned for tax evasion, or have been convicted of this crime or of one of the crimes specified in Articles 188, 189, 190, 191, 192, 193, 194, 195, 196, 202, 250, 251, 253, 254, 304, 305, 306, 309 and 311 of the Penal Code, and have not had their criminal records cleared.

9 specific tax evasion behaviors include:

(1) Failure to submit tax registration documents; failure to submit tax declaration documents; submission of tax declaration documents after 90 days from the deadline for submitting tax declaration documents or the expiration of the tax declaration filing extension as prescribed by law;

(2) Failure to record in the accounting books the revenues related to determining the amount of tax payable;

(3) Not issuing invoices when selling goods or services or recording a value on the sales invoice lower than the actual payment value of the goods or services sold;

(4) Using illegal invoices and documents to account for goods and input materials in activities that generate tax obligations, reducing the amount of tax payable or increasing the amount of exempted tax, reduced tax or increasing the amount of deductible tax or refunded tax;

(5) Using other illegal documents and vouchers to incorrectly determine the amount of tax payable or the amount of tax refunded;

(6) Falsely declaring exported or imported goods without supplementing the tax declaration after the goods have been cleared through customs, if not falling under the cases specified in Articles 188 and 189 of this Code;

(7) Intentionally failing to declare or making false declarations about taxes on exported or imported goods, if not falling under the cases specified in Articles 188 and 189 of this Code;

(8) Colluding with the shipper to import goods, if not falling under the cases specified in Articles 188 and 189 of this Code;

(9) Using goods that are not subject to tax, are exempt from tax, or are considered for tax exemption for purposes other than those prescribed without declaring the change of purpose of use to the tax authority.

Tax evasion of over 1 billion VND can be punished with up to 7 years in prison

According to the provisions of Clause 2, Clause 3, Clause 4, Article 200 of the Penal Code No. 100/2015/QH13, a fine of VND 500 million to VND 1.5 billion or imprisonment of 1 - 3 years applies to one of the following cases of individual tax evasion: Organized crime; tax evasion amount from VND 300 million to less than VND 1 billion; abuse of position and power; committing the crime 2 times or more; dangerous recidivism.

In particular, tax evasion of VND1 billion or more will be subject to a fine of VND1.5 - 4.5 billion or imprisonment of 2 - 7 years.

Offenders may also be fined from 20 to 100 million VND, banned from holding positions, practicing a profession or doing certain jobs from 1 to 5 years, or have part or all of their assets confiscated.

Commercial legal entities may be prohibited from operating.

A fine of VND 300 million to VND 1 billion will be applied to a commercial legal entity that commits one of the acts specified in Clause 1, Article 200 of the Penal Code with an amount from VND 200 million to less than VND 300 million, or from VND 100 million to less than VND 200 million but has been administratively sanctioned for tax evasion, or has been convicted of this crime or one of the crimes specified in Articles 188, 189, 190, 191, 192, 193, 194, 195 and 196 of this Code, and has not had its criminal record cleared but still commits the violation.

The fine will increase to 1 - 3 billion VND in one of the following cases: organized crime; tax evasion amount from 300 million VND to less than 1 billion VND; committing the crime 2 times or more; dangerous recidivism.

In particular, commercial legal entities committing tax evasion with an amount of VND1 billion or more will be fined from VND3 to VND10 billion or have their operations suspended from 6 months to 3 years.

A commercial legal entity will be permanently suspended from operating in one or several areas where the commercial legal entity commits a crime that causes damage or is actually capable of causing damage to the lives of many people, causing environmental incidents or adversely affecting security, order and social safety, and is unable to remedy the consequences.

A commercial legal entity established solely to commit crimes shall have all operations permanently suspended.

In addition, commercial legal entities may also be banned from doing business, banned from operating in certain fields or banned from raising capital for 1 - 3 years.