Vietnam Tightens Exit Ban for Tax Defaulters, Including Those with Unclear Business Addresses

The Vietnamese government has issued a new decree (Nghị định 252) to strengthen exit bans for individuals and entities that have failed to meet their tax obligations. Notably, the government has decided to apply exit bans to taxpayers whose business addresses have become unclear, without setting a minimum tax debt threshold, such as the previously considered VND 1 million. This new decree will take effect from July 1. Individuals, business owners, and company representatives who are found to be absent from their registered business addresses for 120 days, and have not restored their tax identification numbers after notification from tax authorities, will be temporarily banned from exiting the country. This clarifies a policy already in effect since late February 2025 under Decree 49, which addresses taxpayers with unclear business addresses. Previously, the Ministry of Finance had proposed a minimum tax debt of VND 1 million for taxpayers with unclear business addresses. This was intended to prevent individuals from being banned from exiting due to minor tax arrears caused by technical errors or delayed data updates. At that time, tax authorities reported nearly 1 million taxpayers nationwide were no longer operating at their registered addresses, with approximately 496,000 cases owing less than VND 1 million. In addition to unclear business addresses, the new decree maintains existing grounds for exit bans. These include individuals and business owners owing VND 50 million (approximately USD 2,000) or more, and representatives or owners of companies and cooperatives owing VND 500 million (approximately USD 20,000) or more, with debts overdue by more than 120 days. It also covers individuals who are emigrating abroad but still have tax debts. Furthermore, the owners who benefit from companies that are subject to tax enforcement for debts of VND 500 million or more, overdue for over 120 days, may also face exit bans. Tax authorities will issue a 30-day advance notice to taxpayers subject to these warnings. If tax obligations are not fulfilled within this period, tax authorities will forward the case to immigration management agencies to implement the exit ban. According to tax department statistics, over 105,000 taxpayers are currently facing exit bans for tax debts exceeding VND 61 trillion (approximately USD 2.5 billion). Of these, about 60,000 cases involve taxpayers no longer operating at their registered addresses, with total arrears of around VND 6.9 trillion (approximately USD 280 million). Tax authorities have recovered over VND 400 billion (approximately USD 16 million) from approximately 13,000 individuals subject to exit bans. Specifically, from the group with unclear business addresses, over VND 100 billion (approximately USD 4 million) has been recovered from about 7,100 cases.