Relationship between accounting and tax regulations in Viet Nam: A theoretical analysis

Abstract

In Viet Nam, accounting has been moving towards emphasizing faithful representation and relevance of financial information which is useful for financial statement users to make decisions, and has become more and more independent from taxation. However, the degree of independence between accounting and taxation in Viet Nam is questionable and should be determined to help improve the independence between the two systems to best meet their different aims. This paper adapts the approach of Lamb et al. (1998) to measure the degree of independence between accounting and taxation in Viet Nam. Accordingly, the content analysis method is used to identify the relationship between accounting and tax regulations. Accounting and tax regulations which are effective at present, issued during the period 2013-2019, are analyzed in the paper. The result shows that the connection between accounting and taxation is relatively interdependent. Suggestions to reduce the interdependence are that determination of income tax should be based on certainty, and estimation and changes in accounting policies for taxation purposes are not allowed.