From 1/7, Vietnam restructured its administrative boundaries, reducing the number of provinces and cities from 63 to 34 and implementing a two-tiered administrative system (province and commune/ward). Ten days later, businesses are still facing confusion and system errors when carrying out administrative procedures and online public services related to taxes after the merger.

Systems failing to synchronize automatically

A representative of a trillion-dong consumer goods company in TP HCM said that they proactively updated their new address according to the new administrative boundaries on the electronic invoice system immediately after the merger. However, they encountered several problems. For instance, with customers who haven't updated their new addresses, the accounting software system can't synchronize automatically. This forces accountants to manually check and compare addresses every time they issue an invoice.

"The company issues over 1,000 invoices per day. If we have to manually adjust each one due to address discrepancies, it's almost impossible to manage," she said.

Similarly, the owner of a small tourism service business in Hanoi said that having to re-check each partner's address, coupled with the slow system, sometimes takes them 30-40 minutes to issue a single electronic invoice.

Furthermore, businesses are also facing difficulties in paying taxes due to changes in the organizational structure and names of tax authorities after the merger. "For example, what was previously the Tax Sub-Department of District 1 and District 2 has now changed to Tax Team 1 and 2. But if the new recipient's name isn't updated in the bank's system, it will cause tax payment documents to be suspended."

Following the administrative merger, the electronic tax system has been converted and updated with new data on place names. According to the General Department of Taxation, the system has been operating smoothly nationwide. For agencies with data links to the tax authorities, synchronization is being completed to facilitate procedures related to taxpayers.

Citizens download the tax sector's eTax application to declare and look up tax information. Photo: Khuong Nha

Citizens download the tax sector's eTax application to declare and look up tax information. Photo: Khuong Nha

Le Thi Yen, CEO of Hanoi Tax Consulting Company Limited (Hanoitax), pointed out that the biggest technical obstacle is data synchronization in companies' internal software after the tax authorities' system has updated the list of administrative areas.

For example, many users are still encountering errors due to not updating their software promptly. A typical example is with the tax declaration application, where many accountants upgraded to the new version but didn't update their "Business Information." As a result, they can't export declarations (error messages regarding file code and unreadable versions). The reason, as mentioned, is that the tax authorities have standardized the list of administrative areas, removing the district level and changing ward and commune names, causing changes to the tax management information of businesses.

As a solution, Yen said that accountants are forced to go to the "System" menu, re-select the province, headquarters address, managing tax authority, etc., according to the new data before they can create new declarations.

Meanwhile, when using the online Electronic Tax Portal (eTax), the business address data has been automatically adjusted by the tax authorities on the system, so online filing is mainly only delayed due to system upgrade time.

Regarding electronic invoices, Yen said that for businesses using free electronic invoices on the tax authorities' system (usually households and individual businesses in remote areas), the tax authorities have automatically converted addresses according to the new list. Therefore, issued invoices will display the new address without requiring any further action from the user.

However, for businesses using services from intermediary organizations, the Hanoitax CEO said the responsibility for updating the administrative area lies with the software provider. In cases where the provider hasn't updated yet, Yen advised that businesses can continue to issue invoices with the current system without being considered in violation.

"This helps minimize the risk of disrupting sales activities, but in the long run, businesses should proactively check and request their invoice providers to update the new address information," she said.

Business information mismatch

In recent days, the Ha Hai Law Office and Associates, a firm providing tax and legal consulting and support to businesses, has continuously received feedback from businesses about obstacles in updating addresses on legal documents, tax systems, and bank accounts.

Although the office's consultants are "working at full capacity," Ha Hai, Head of the Office and Vice Chairman of the TP HCM Bar Association, said that processing is still delayed because "many technical processes aren't synchronized and lack unified guidance from the authorities." Many applications are on hold or returned due to errors such as address mismatches. For example, the information on electronic citizen identity cards sometimes doesn't match the new administrative address system. "Some businesses have had their applications rejected because their citizen identity cards state 'Group 4,' but the system identifies it as 'Group 7'," he exemplified.

According to a Hanoitax representative, many businesses reported errors when filing electronic tax returns due to address mismatches after the local merger. The main reason is that after the administrative boundary changes, the address and managing tax authority information of businesses in the tax declaration software was automatically updated, leading to discrepancies with the old data.

To resolve this, Yen said that businesses are forced to update all new address information on the declaration system before creating new declarations. However, this causes inconvenience for accountants, especially those who are unaware of the reason for the error; they have to look up the new address of the business on the General Department of Taxation's lookup site and then re-enter it into the software.

Similarly, businesses are also concerned when the seller's address in the tax database has changed to the new name, but the Business Registration Certificate may still show the old name. Many businesses worry that invoices with the old address will no longer be valid, or conversely, if they use the new address, it won't match the business registration.

However, according to Yen, the tax authorities allow businesses to continue issuing invoices as usual without penalty, even if the address information on the invoice hasn't been adjusted yet. This means businesses are still allowed to use the current electronic invoice system normally.

Also, according to regulations, when the headquarters address changes its name due to administrative rearrangement, businesses aren't required to immediately adjust their licenses. Many businesses were initially confused, unsure whether they needed to submit an application to change their business registration to update the new address.

Regarding this, Yen said that businesses can continue to use their existing business registration certificates. They can proactively update the new address when needed or when changing other information. In cases where businesses voluntarily adjust their address, the authorities will provide support and not charge fees as this change stems from an administrative decision.

At a meeting with the General Department of Taxation last week, solution providers committed to supporting the operation of the online public service system, strengthening transmission lines, and improving server performance. They also proposed upgrading the automatic error monitoring and warning system for early detection of incidents. The solution providers committed to 24/7 technical support during peak periods to resolve all obstacles and difficulties, maximizing support for taxpayers.

From the management perspective, Mai Son, Deputy Director General of the General Department of Taxation, requested units, especially the Digital Transformation Board (General Department of Taxation), to urgently preside over the establishment and operation of a hotline, connecting with 34 provincial tax departments to receive and process information during the tax administrative procedure resolution process.

"Each local tax authority must assign a focal point to coordinate promptly with the General Department of Taxation to ensure smooth information flow, feedback, and prompt resolution of taxpayers' difficulties," he requested.

The Digital Transformation Board is assigned to coordinate with the Tax Operations Board to connect and regularly share data with solution providers, ministries, branches, and functional units of the Ministry of Finance to ensure daily updates of information from localities regarding technical errors, connections, and obstacles in document processing. Additionally, the tax authorities are coordinating with the Public Administration Center to define roles, responsibilities, and processing procedures to ensure that procedures are resolved electronically, comprehensively, and on time.

"Providing complete, timely, and effective tax administrative procedures is a key factor in maintaining a stable and favorable operating environment for businesses and taxpayers in their production and business activities," Son said, affirming that this is a technical requirement and a practical lesson in management experience.

While many businesses are facing numerous obstacles, a representative of Orion Vina Food Company Limited said that their unit hasn't been caught off guard. Thanks to early preparation, all tax-related procedures have proceeded smoothly, and the document system has been processed seamlessly according to the tax authorities' procedures. The company is also awaiting specific guidance regarding the remaining inventory of packaging printed with the old address to declare it correctly.

Currently, there are nearly 1 million businesses and over 5 million business households nationwide. The Hanoitax CEO believes that encountering difficulties is unavoidable. This is because the nationwide taxpayer data is vast, which can easily lead to errors during the conversion process. "Taxpayers encountering obstacles should immediately contact the tax authorities' support channels during the administrative boundary rearrangement and change process," she further recommended.

Thi Ha - Phuong Dung