Consider exemption from first-time violation penalties
The Ministry of Finance is seeking opinions on the draft Law on Supporting Small and Medium Enterprises (amended), which proposes many new support mechanisms for businesses transforming from household businesses to promote the goal of reaching 2 million businesses by 2030.
According to the draft, the content of supporting small and medium-sized enterprises to transform from household businesses is regulated in Article 20, based on inheriting Article 16 of the Law on Supporting Small and Medium Enterprises in 2017 but expanded in a more comprehensive direction.
The Ministry of Finance said that enterprises after conversion will inherit all rights, obligations and legitimate interests of business households according to the provisions of law.
In case a limited liability company or joint-stock company is established on the basis of conversion from a business household, the business household owner must still be responsible with all of its assets for the unpaid debts of the business household, except for other agreements as prescribed by law.
The draft proposes that small and medium-sized enterprises converted from household businesses be supported, guided and warned by the State about the level of compliance with the law within 1 year from the date of being granted the first Business Registration Certificate.
During this time, if a business violates tax, accounting, social insurance, labor, business conditions and other administrative obligations for the first time but does not fall into the case of fraud, evasion of obligations or causing serious consequences, it will be prioritized for guidance on remedy, completion of procedures and may be considered for exemption from administrative violation penalties according to regulations.
Free of many types of fees, digital platform and accounting support
In addition to general support policies, the draft also proposes to exempt business registration fees and fees for announcing business registration content for the first time for businesses converted from household businesses.
At the same time, this group of businesses is also exempt from appraisal fees, fees and charges for initial issuance for licenses, certificates, professional certificates and other forms of business investment conditions as prescribed.
The draft also allows small and medium-sized enterprises to convert from household businesses to apply the mechanism of declaration and tax payment, accounting regime and simple reporting regime of micro-enterprises according to tax and accounting laws.
In addition, businesses will be supported with costs for accessing and using digital platforms, accounting software and digital solutions for management, operation, accounting, electronic invoices, payment and e-commerce.
Newly established small and medium-sized enterprises are also supported with accounting service costs for a maximum of 2 years from the date of being granted the first Business Registration Certificate.
According to the draft, businesses converted from household businesses will also be supported with training, consulting, advisory, training and in-depth legal support to improve management capacity and compliance with the law.
The State will develop comprehensive financial products and services suitable to the characteristics, scale and needs of this group of businesses.
Another noteworthy point is that enterprises undergoing conversion will be supported with the transfer of tax data, invoices, social insurance and credit history to limit disruptions in operations during the model conversion process.
The draft also stipulates that business households will not be allowed to continue operating under the name of business households from the time the transformed small and medium-sized enterprise is granted a Business Registration Certificate.
According to the Ministry of Finance, expanding support policies aims to create motivation for business households to transform into enterprise models, contributing to improving transparency, management capacity and access to resources of the private economic sector.
