Closely monitoring taxpayers with signs of violation of tax law

1. The taxpayers in the following cases of close monitoring about tax are the taxpayers with the following signs:

a) The taxpayers doing transactions through banks have doubtful signs as prescribed by law on prevention and control of money laundry related to the tax evasion and tax fraud.

b) The taxpayers or their legal representatives are prosecuted for acts of violation of tax and printed matters of tax.

c) The taxpayers with high risk levels of tax about major issues need monitoring of tax management.

2. The tax authorities at all levels use the application of operational information system about the subjects specified in Clause 1, Article 20 of this Circular to take prescribed operational measures of tax management.

3. The tax authorities at all levels shall monitor and apply the appropriate operational measures of tax management to each case specified in Clause 1, Article 20 of this Circular.

4. Updating of result and feedback:

a) Department of Taxation shall aggregate and update the result of application of operational measures to each specific case and report to the General Department of Taxation.

b) The General Department of Taxation shall aggregate and analyze to give out the risk warnings in tax management to all tax authorities at all levels.

5. The General Department of Taxation shall specify the collection and analysis of information, take monitoring measures in accordance with regulations of law in each period.

Section 2. APPLICATION OF RISK MANAGEMENT IN TAX MANAGEMENT OPERATIONS

Article 21. Application of risk management in tax management and registration

1. The tax authorities shall receive the tax registration dossiers directly submitted at the tax authorities and transferred by the business registration body on the system connecting information with the business registration body, based on the classification of database system of tax operation information about cases of tax verification and registration specified in Article 19 of this Circular to apply the appropriate measures in settlement and handling or coordinate with the business registration body in settlement and handling as prescribed by law on business registration and tax registration.

a) For dossier of newly-established taxpayers performing the tax/enterprise registration for the 1st time; dossier for change of information about tax/enterprise registration or dossier for registration of business suspension: Automatically issue the tax code/enterprise code to the newly-established taxpayers; accepting dossier with changed information or business suspension in accordance with current regulations on tax and business registration and based on the list of cases of verification of tax registration specified in Article 19 of this Circular to carry out the verification or coordinate with the business registration body and other relevant state management bodies to carry out the verification under the current regulations of law.

b) For dossier registering dissolution, bankruptcy or operating termination:

– Update the status of dissolution, bankruptcy or operating termination on the tax registration application system for cases that have completed their prescribed obligations on tax.

– Require the taxpayers or send notice to business registration body to require the taxpayers to fulfill their tax obligations prior to their dissolution, bankruptcy or operating termination.

Simultaneously, based on the list of verification cases of tax registration specified in Article 19 of this Circular to verify or coordinate with the business registration body and other relevant state bodies to perform the verification under the current regulations of law.

2. Updating and feedback of result:

The tax officers shall process the tax registration dossiers on the database system on taxpayers by the electronic method; for cases of paper method, the tax authorities must update fully and correctly the handling measures and verification results in the operational information system for each specific case for risk management, assessment of taxpayer’s compliance with tax law.