Cashless payment: Need a suitable route


The Tax Department of Ho Chi Minh City has just proposed to the Government to soon regulate the application of non-cash payment for all sales and purchases, without limiting the total payment value. However, many businesses and experts believe that this proposal is not feasible.

For easy tax management

Specifically, the City Tax Department proposed to the Government to stipulate that businesses make non-cash payments for all sales and purchases, without limitation for the total payment value of 20 million VND or more, must go through banks. (NH) as prescribed by the Law on VAT. The application of this regulation will assist tax authorities in controlling revenue and expenses of organizations engaged in production and business activities, and strengthen the strictness of tax administration.

According to Mr. Le Duy Minh, Director of the City Tax Department, it is feasible for businesses to make non-cash payments. Because non-cash payment methods such as credit cards, ATM cards, e-wallets, third-party payments are increasingly popular and used by many organizations and individuals.

Thus, when businesses do not accept cash payments, buyers must have a new bank account to transact. At the same time, when businesses buy goods and services and make other payments to an individual, that individual must have a bank account to receive the payment. From there, people will be motivated to open a bank account to pay for businesses and vice versa. “This regulation will assist tax authorities in controlling revenue and expenses of organizations engaged in production and business activities, and strengthen the strictness of tax administration. For this, the Government needs to adjust the provisions of the Law on VAT to submit to the National Assembly for approval,” – Mr. Minh suggested.

Deputy general director of a commercial bank in Ho Chi Minh City assessed that with the current technology system and payment infrastructure of banks, it is feasible to gradually switch to non-cash payment for business transactions. The non-cash payment also saves costs for society and for businesses themselves, faster cash flow, thereby bringing economic value to society.

Customers pay by card when shopping at a supermarket Photo: Hoang Trieu

Not feasible if done immediately

However, the proposal of the City Tax Department was not supported by businesses, economists and consumers. Mr. Nguyen Minh Man, Communications Director of TST Tourist Company, said that the trend of using non-cash payment methods is now quite popular with many forms of cards, e-wallets, transfers… Businesses Payments are also mainly made by bank transfer. However, cash is still used by businesses and customers in parallel, businesses still have to receive cash from customers but cannot refuse. Therefore, there is a need for a roadmap towards synchronization and safety in online transactions.

Many other businesses also agree that transactions between businesses can be paid electronically, but customers cannot force them to pay by wallet or card. In fact, most people still prefer to use cash, even some people used to pay via cards and other online channels, but recently, high-tech criminals are increasingly sophisticated; Fraudulent behavior, appropriating money from personal accounts often occurs, so they return to using cash. Therefore, it is necessary to improve this issue so that individual customers and businesses can feel secure in cashless transactions.

Ms. Nguyen Thi Van (living in Binh Thanh District, Ho Chi Minh City) said that every time she goes to the supermarket to shop, she usually swipes her card or uses an e-wallet, but sometimes still uses cash. “If businesses do not accept cash payments, I will switch to other companies’ services. Customers only use cashless payment channels if they really feel convenient,” – Ms. Van said.

Financial expert Dr. Huynh Trung Minh analyzed that in many countries, businesses’ transactions must be paid through a non-cash channel to be eligible for VAT deduction. Currently, the VAT Law stipulates that for payments with a total value of 20 million VND or more, in order to receive VAT deduction, organizations must make non-cash payments. However, with the proposal that all transactions of enterprises buy and sell without limit on the total transaction value, it will be difficult to do because of the characteristics of the Vietnamese economy, which still uses cash.

For example, businesses in the agricultural sector, when purchasing fruits, food and seafood from farmers, most of them pay cash, but cannot transfer money. The transactions in rural areas of farmers with businesses are many, it is not possible to ask them to open an account just to sell 1-2 crops of rice, fruit, harvest agricultural products a year…

“The tax authority may consider proposing a reduction in transaction value according to the roadmap, reducing 5-10 million dong so that the market, businesses and customers gradually adapt, especially small businesses and households. have a trading relationship with enterprises” – suggested Dr.



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