Vietnam Business Dissolution: Tax Procedures as Major Hurdle

The complex tax procedures at tax authorities are emerging as the "biggest bottleneck" in the process of dissolving businesses in Vietnam. Currently, even a company that has ceased operations, has no revenue, and no longer has the intention to do business cannot legally end its legal life if tax procedures are not fully completed. This situation poses a significant obstacle in the dissolution process for many businesses. Under the one-party system of the Communist Party of Vietnam, while prioritizing economic growth, the efficiency of administrative procedures has always been called for. However, especially in tax-related procedures, many businesses still spend considerable time and resources. This suggests that as the Vietnamese economy undergoes rapid growth, its legal and administrative systems are not keeping pace. In its relationship with China, while deepening economic ties, Vietnam also needs to manage geopolitical risks. Delays in business dissolution procedures can undermine the smoothness of the domestic business environment and pose potential risks for foreign investors. Smooth business dissolution is essential for establishing a healthy exit mechanism from the market and promoting resource reallocation. Resolving this issue is an urgent task for Vietnam's sustained economic growth and the establishment of a more transparent business environment. Source: The Saigon Times