Tax authority questions more than 400 high-revenue firms reporting losses, raising tax compliance concerns

Vietnam’s Tax Department says it has reviewed nationwide tax declarations and found that a notable number of high-revenue firms are reporting losses or only thin profits. At the Ministry of Finance’s Q1/2026 regular press briefing on April 9, Le Long, Deputy Director of the Tax Department, said that more than 400 enterprises with annual revenue of 1,000 billion VND or more posted losses or only marginal profits.

Losses raise concerns about declaration accuracy

From a risk-management perspective, the Deputy Director noted that persistent losses over multiple years, alongside business expansion or capital investment, can cast doubt on whether firms’ tax declarations and accounting are accurate. He said the problem remains widespread among companies with multi-year losses and thin margins.

“The Tax Department has also built and assigned tasks to provincial and city tax authorities and related units to implement measures to boost tax administration and curb revenue losses for firms with prolonged losses, thin-margin, or losses over many years,” Mr. Le Long said.

Measures introduced in 2025 and continued in 2026

Mr. Le Long said the causes of sustained losses or very thin profits may include both objective and subjective factors. However, he added that some firms continue to expand or increase investment despite losses. To address this, the Tax Department has rolled out synchronized measures to strengthen tax administration for this group of firms.

Guidance, warnings, and improved compliance

The Tax Department has promoted legal awareness and tax filing guidance, requiring firms to declare truthfully and accurately while warning of legal consequences for misreporting, fraud, or tax evasion.

More reviews and on-site inspections

The department said it will intensify reviews of tax filings and conduct on-site inspections. Where errors are detected, tax authorities will guide firms to declare and adjust promptly.

Targeted audit selection for high-risk firms

The Tax Department has reviewed and compiled a list of some firms with revenue from goods and services of 1,000 billion VND or more that have incurred two consecutive years of losses. The list is used to analyze and identify high tax-risk firms for audit under a 2026 special program.

Earlier, the Tax Department issued Official Dispatch No. 1927/CT-KTr, directing subordinate units to tighten management and accelerate 2026 audits for firms that are loss-making, have thin margins, or have long-term losses, with the aim of detecting fraud and ensuring proper revenue collection.

Audit plan and scope

Audit work will be planned by the Large Enterprises Tax Branch, E-Commerce Tax Branch, and provincial tax departments. Detailed audit plans for each firm are to be prepared in April 2026 and completed no later than December 2026.

Key areas tax authorities will examine

During inspections, tax authorities said they will focus on the reasonableness of revenue, costs, and profits, particularly large or unusual costs; the timing and basis of revenue recognition; input and output VAT declarations; invoices and valid documents; cost of goods sold; management and selling expenses; internal interest costs; internal services; and contracts with related parties—ensuring transactions reflect independent dealings and actual business activities.