Government issues decree to push last companies to adopt e-invoicing
The Vietnamese Prime Minister, Phạm Minh Chính, has issued a directive to drive adoption of e-invoicing by the small proportion of businesses not yet compliant.
The Directive (No 129/CD-TTg) addresses the issue that, although the nationwide electronic invoicing system has streamlined tax administration and made life easier for businesses, gaps remain in the adoption of electronic invoices, especially among retail outlets and local businesses. The rapid growth of e-commerce further complicates tax collection and State oversight, requiring additional measures.
According to a Government report, by mid-2023 99 per cent of businesses and organisations in the Southeast Asian country had transitioned to using e-invoices. The electronic system has generated over 4.5 billion e-invoices since its implementation. VNS
E-invoice process
The second phase of the national rollout of mandatory invoicing between April and July 2022 resulted in 764,314 tax payers registering according to the General Department of Taxation. This is 92% of these obliged to do so. This covers 57 provinces and cities not included in Phase I, last year.
Invoices must contain the basic VAT information in XML, plus a secure digital signature held for at least 10 years. The following businesses must also obtain a GDT verification code:
- self-employed
- larger businesses (threshold in excess of VND 10billion) and
- high tax risk enterprises with a poor compliance record
Businesses may deal directly with the GDT from Phase 2, requiring direct registration, under strict rules on e-invoice up-time, creation, storage and backup. Alternatively, they may engage authorised e-invoicing third-party agents.
Categories of documents including in e-invoicing
The following documents are included within the requirements
- Value-added tax (VAT) e-invoice;
- Sales e-invoice;
- Sales of public property e-invoice;
- National reserve sales e-invoice;
- Electronic stamps, electronic tickets, electronic cards, electronic receipts, and other electronic documents with e-invoice content; and
- Electronic warehouse delivery/transportation notes and electronic delivery notes sent to agents.
For e-invoicing, it is imperative to get VAT calculations correct. VAT Calc’s in real-time global Calculator and Auditor services produce instant and accurate tax calculations into your ERP, billing, e-commerce or e-invoicing systems.
Phase 2 of electronic invoicing April to July 2022
Following the November 2021 launch of e-invoicing in six cities, it was be extended to further 57 cities of Vietnam between 6 April and 1 July 2022. This will include the option to transmit electronic invoices directly to the government instead of via an authorised intermediary as with Phase 1.
Phase 1: delayed mandatory B2B electronic invoicing November 2021 go-ahead
Vietnam General Department of Taxation (GDT) has commenced the 2-phased implementation of mandatory pre-clearance e-invoicing between November 2021 and April 2022. This started in six cities. It had already been delayed from 1 November 2020 due to the COVID-19 crisis.
The GDT has been anxious to complete the e-invoice roll out as the current paper-based system is highly susceptible to fraud and is cumbersome to manage for taxpayers and the GDT to administer.
You can follow VAT Calc’s global live VAT invoice transaction and e-invoice blog with country-by-country real-time reporting plans.
Phase 2: e-invoicing to complete by July 2022
Vietnam already has a paper-based GDT-controlled invoicing system. Taxpayers may only use GDT printed (or printed on GDT approved special printers) invoices with an authentication code. These may still be used until July 2022. The two phases are:
- November 2021 in major conurbations, including: Hanoi, Ho Chi Minh City, Hai Phong, Quang Ning, Phu Tho, and Binh Dinh; and
- April to July 2022: remaining 57 provinces.
However, any business incorporated since 19 October 2020 must use the new e-invoicing regime now. In addition, GDT may switch other businesses now if they exhaust their paper invoice supply.
