Digital Revolution in Vietnam's Tax Sector: Electronic Invoicing for Household Businesses
Vietnam Mandates Electronic Invoicing for Domestic Businesses to Bolster Tax Transparency
Welcome, folks! Let's dive into the ongoing transformation that Vietnam's tax sector is experiencing, with the implementation of electronic invoices (e-invoices) for household businesses. This significant change aims to reduce revenue loss and boost transparency in the taxation process.
Since June 1, a plethora of businesses, from small traders to service providers, have been mandated to employ e-invoices directly from cash registers. This innovative system records and sends transaction details to the tax authorities in real-time, marking a significant shift in the tax authority's management of household businesses.
Reflecting the change stipulated in Decree 70/2025, many businesses have warmly embraced the new regulations. They believe these changes will help combat risks such as confusion between personal and business finances, selling goods without issuing invoices, and losses due to poor control over input materials or outgoing orders.
Sales management software has been a popular choice among businesses. Platforms like KiotViet, Sapo, and Salesbook offer tailored solutions for various customer segments and industries. Despite this, some households continue to rely on comprehensive services provided by large companies such as Viettel, VNPT, and Misa.
A staff member at the Petrolimex Hà Tĩnh gas station transmits sales data to the tax authority's system. - VNA/VNS Photo
However, there are still business owners hesitant about the change. Nguyen Huy Hung, a catering business owner, invested VND10 million to install new equipment and hired a young employee to manage the counter. He expressed concerns about potential technical issues, leading to errors in incoming invoices or delays in issuing invoices. To avoid such issues, he hopes the tax authority will establish binding agreements with equipment suppliers for support.
Nguyen Hu Sau Ta, who operates a mobile coffee business, faces challenges due to his non-fixed location. He and his staff often encounter difficulties with data transmission and equipment placement, making it tough to adopt the same equipment used in stationary shops. He is now exploring service options that can be seamlessly integrated into smartphones or compact, user-friendly devices.
From an expert's perspective, Nguyen Van Duoc, general director of Troong Tin Accounting and Tax Consulting Company, acknowledges that the transition from paper invoices to electronic invoices may pose initial challenges. Lack of resources, such as the necessary technology or equipment, poses obstacles to many household businesses. Despite this, business households are required to adapt to the new system. If the tax authority offers the appropriate policy and technological support, they can gradually ease the constraints while ensuring accountability.
Currently managing more than 271,000 business households, the Tax Department of Region I is actively collaborating with localities to ensure no unregistered households are overlooked. The authority is also updating its management list with businesses that must use invoices generated from cash registers.
A value-added tax invoice is issued to customers after each sale at Petrolimex Hà Tĩnh. - VNA/VNS Photo
"From now until June 1," said Nguyen Tien Minh, deputy head of the Tax Department of Region I, "we will conduct public awareness campaigns to address the challenges faced by business households during this transition.” The department will work hand in hand with electronic invoice solution providers to offer tailored support to these households and link electronic invoices from cash registers with electronic tax declarations.
Let's not forget the Minister of Finance reaching out to leaders of various provinces and cities, urging them to support the tax sector in nationwide implementation of electronic invoicing from cash registers.
However, non-compliance may result in penalties, including fines and temporary suspensions of operations for household businesses that fail to register for or issue e-invoices as required. As the nationwide electronic invoicing system evolves, it's crucial for businesses to adapt and stay informed.
The Insight
Embracing electronic invoicing not only enhances transparency in Vietnam's tax sector but also delivers several notable benefits, including improved tax compliance and simplified tax reporting. Despite the positive impact, business owners face technical, regulatory, and training challenges. Fortunately, recent updates in the system allow for the authorization of third parties to issue e-invoices on behalf of businesses, providing flexibility to address these challenges.
- The implementation of electronic invoices (e-invoices) in Vietnam's tax sector signifies a shift towards technology in the business realm, impacting household businesses directly.
- Acknowledging the digital transformation, many businesses have adopted sales management software like KiotViet, Sapo, and Salesbook to facilitate their e-invoice requirements.
- Despite the government's efforts, some businesses owners, such as Nguyen Huy Hung, express concerns about potential technical issues when adopting e-invoices.
- In light of such challenges, Nguyen Hu Sau Ta, who operates a mobile coffee business, seeks service options that can be seamlessly integrated into smartphones or compact, user-friendly devices.
- The transition to e-invoices is deemed crucial by experts, such as Nguyen Van Duoc, who urges the tax authority to provide policy and technological support to help businesses adapt.
- Understanding the difficulties faced by businesses during this transition, the Tax Department of Region I is working on public awareness campaigns and collaborating with electronic invoice solution providers to offer tailored support, ensuring a smooth integration into the digital tax system.
