Reforming procedural bottlenecks
By simplifying documentation and strengthening accountability, the new regulations are creating a more open legal framework, enabling incentive policies to be implemented more swiftly.
Continuing its pro-business approach, Circular 21 makes it significantly easier to access land rent exemption and reduction policies. A notable highlight is the shift in mindset regarding documentation for those suffering losses due to natural disasters or fires.
Rather than requiring a multi-layered verification process, damage assessments are now delegated to financial authorities or independent appraisal organisations, which are held legally accountable for their findings. This ensures greater objectivity while reducing the documentation burden on affected individuals.
In parallel, enterprises forced to suspend operations due to force majeure events are also receiving positive support. Applications for exemptions and reductions have been streamlined to focus on core documents, such as confirmation of suspension periods and land lease decisions. This approach removes unnecessary requirements, enabling businesses to resume production more quickly.
Fostering proactivity and accountability
Beyond cutting procedures, the new circular demonstrates strong trust in taxpayers’ self-compliance. For entities employing large numbers of ethnic minority workers or persons with disabilities, business owners may now self-declare and are accountable for the accuracy of the information submitted.
This shift in management approach establishes a transparent post-audit mechanism in place of the cumbersome pre-audit system. It not only shortens processing times but also promotes a culture of integrity in business, where each enterprise becomes an active participant in upholding the law.
More broadly, a defining feature of Circular 21 is its decisive push for digital transformation. The new provisions allow tax authorities to directly access integrated data from national databases.
As a result, land lessees are effectively relieved of the obligation to submit documents already held by state agencies. This not only reduces social costs but also minimises the risk of misconduct arising from face-to-face dealings between officials and businesses.
However, to ensure smooth implementation, the circular clearly stipulates that where data are not yet synchronised, taxpayers are responsible for ensuring their data is kept up to date. This reflects a mutually supportive relationship between the state and citizens in the digital era, where data accuracy is a prerequisite for accessing preferential policies.
Circular 21 stands as clear evidence of the Ministry of Finance’s determination to remove institutional bottlenecks. With clearer classification, transparent procedures and robust application of technology, the policy is set to serve as an important lever for improving the investment climate and promoting sustainable economic development.
