As of July 1, Vietnam has implemented its new mandatory e-invoicing system, enabling businesses and tax authorities to be part of creating a more transparent, efficient and favourable business environment
The adoption of a new system finally came into effect this month, two years later than originally planned after a grace period was allowed for companies to make the adjustment. Prior to recent changes, businesses were advised to prepare themselves for the adoption of the new system which will significantly transform the public and private sector and government. The move to an electronic invoicing system will instate transparency in communications with enterprises and government and reform administrative processes to increase productivity, efficiency, reduce costs and support e-commerce growth.
The first stage of adoption was aimed at digitalising six provinces and cities in Vietnam including Hanoi, Ho Chi Minh City, Hai Phong, Quang Ning, Phu Tho, and Binh Dinh. The remaining 57 provinces and cities.are now successfully completing a national effort to use electronic systems in all aspects of business and government operations.
While electronic invoices have been available in Vietnam since 2011, it was only in September 2018 that the digitalisation of sectors became a national obsession, leading to the current policy on the widespread use of e-invoices to combat tax fraud in particular.
Following the grace period, companies will now be expected to come onboard with automated procedures and phase out printed or purchased invoice collateral from the tax authority.
Vietnam operates two different procedures of e-voicing which require trade or service sectors and the self-employed to use verification tax codes while unlisted companies can submit invoices without verification.
With 92% of Vietnamese firms converting to use electronic invoices, the government’s priority will also be on protecting cybersecurity capabilities of the system to facilitate a broader digital revolution.