Vietnam businesses face financial strain from VAT and customs hurdles

Vietnamese businesses, particularly in the wood sector, are facing significant financial strain due to inconsistencies between customs and tax authorities regarding Value Added Tax (VAT) and import documentation.

Lam Viet Joint Stock Company reported that despite possessing international certifications like FSC and global positioning data for timber, customs authorities have required additional consular legalization of foreign documents. This process can take months, leading to high port storage fees that sometimes exceed the value of the goods and delaying commitments to international partners.

On a broader scale, while the tax authorities have increased VAT refund amounts—reaching 149,463 billion VND as of September 30—bottlenecks remain. Issues with invoice verification and data reconciliation continue to delay certain files, impacting corporate cash flow. Authorities are working to implement new legal frameworks and automated systems to simplify documentation and accelerate the refund process.