On May 25, 2023, the General Department of Taxation issued Decision 657/QD-TCT to disseminate the Regulations on State Compensation Settlement at Tax Authorities at all levels. Through this, the General Department of Taxation provides specific guidance on the scope of compensation liability, the basis for determining compensation liability, and the principles for resolving compensation at tax authorities.
1. Scope and subjects of application of the decision
This regulation guides tax authorities in handling state compensation; procedures for processing compensation claims; compensation funds; and reimbursement responsibilities at all levels of tax authorities.
The entities subject to this decision include:
- General Department of Taxation; Department of Large Enterprise Taxation; Provincial and City Tax Departments; District Tax Offices;
- Tax officials belong to tax authorities at all levels.
2. Scope of State Liability for Compensation of Tax Authorities
According to Decision 657/QD-TCT, the General Department of Taxation stipulates that tax authorities at all levels are responsible for compensating damages in cases of unlawful penalties, specifically as follows:
- The decision to impose administrative penalties is unlawful;
- Applying measures to prevent and ensure the handling of unlawful administrative violations;
- Applying coercive measures to enforce administrative sanctions that are unlawful;
- Applying illegal tax collection, disbursement, and refund procedures; collecting land use fees illegally;
- Failure to apply or misapplication of the provisions of the Law on Whistleblowing regarding measures to protect whistleblowers when they request it, as stipulated in the Law on State Liability for Compensation (Law on State Liability for Compensation);
- Committing acts that are strictly prohibited under the Law on Access to Information, such as intentionally providing false information without correction and without providing the information again;
- The decision to dismiss a tax official, a disciplinary measure within the authority of the Head of the Tax Agency, is unlawful.
3. Basis for determining the state's liability for compensation by the Tax Authority
According to the regulations on compensation settlement, when there are sufficient grounds to determine liability for compensation, the Tax Authority is responsible for providing compensation in accordance with the law. The specific grounds for determining liability for compensation are as follows:
- The basis for determining unlawful conduct by tax officials in the performance of their duties, causing damage and requiring corresponding compensation in accordance with state regulations;
- Causing actual damage to the subject within the scope of the Tax authority's liability for compensation;
- There is a causal link between actual damage and the damaging act.
The document serving as the basis for a compensation claim is a document clearly identifying the unlawful act causing the damage committed by the tax official, and which has legal effect and was issued by a state agency or competent authority in accordance with regulations.
4. Principles for resolving state compensation claims by the Tax Authority
The Tax Authority handles claims for damages according to the following principles:
- In accordance with the law on state liability for compensation, the Tax Authority will process the compensation claim after receiving the supporting documents.
- Timely, equitable, transparent, in good faith, honest, and lawful; conducted on the basis of reasonable negotiation and agreement between the compensation settlement agency and the claimant as stipulated in the Law on State Liability for Damages.
- A claimant who has already submitted a claim to one of the compensation settlement agencies and had it accepted and processed by that agency is not permitted to request another competent authority to settle the claim (except in cases specified in point b, clause 1 and clause 2 of Article 52 of the Law on State Liability for Damages).
- Ensure compliance with the procedures for handling compensation claims.
- The Tax Authority will only compensate for damages caused by tax officials or the Tax Authority itself if the injured party also bears some responsibility for causing the damage.
5. What is the statute of limitations for filing a claim for compensation?
The statute of limitations for claiming compensation is 3 years from the date the person entitled to claim compensation receives the document serving as the basis for the claim, except in cases stipulated in Clause 2, Article 52 of the Law on State Liability for Damages and cases requesting restoration of honor.
The following periods are not included in the statute of limitations for claiming compensation:
- There is a force majeure event or objective obstacle that prevents the person entitled to claim compensation from exercising their right to claim compensation;
- The injured party is a minor, a person lacking or having limited legal capacity, or a person with difficulties in understanding and controlling their behavior who does not have a legal representative, or whose representative has died or is unable to continue as a representative until a new representative is appointed.
The claimant has the responsibility to prove the period of time that is not included in the statute of limitations for filing a claim as stipulated by law.