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Monday, July 22, 2024

Tax revenue from e-businesses below expectations

By N. Tan

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HCMC – Tax revenues from e-commerce activities have risen over the years, but they are still far behind the industry’s expansion rate, the Ministry of Finance reported.

Tax collections from 2018 to date totaled nearly VND5,590 billion. The figure has increased over the years, with the collection growth rate at 130% from 2018 to 2021. The year 2021, in particular, saw the fastest growth, at nearly VND1,600 billion, up 39% year-on-year.

Until now, the ministry saw 37 foreign enterprises registering with tax authorities to use digital tax services via the General Department of Taxation’s portal for foreign companies, collecting over VND3,100 billion.

Among them were multinational conglomerates such as Meta Platforms, Inc. (Facebook), Google, Microsoft, TikTok, Netflix and Apple.

The General Department of Taxation also stepped up on collecting taxes from domestic e-businesses, with tax revenues in the first eight months of 2022 doubling the figures in the same period in 2021, at VND520.7 billion.

However, the tax sector was fraught with difficulties in collecting taxes from e-commerce platforms as identifying sellers’ earnings, classifying types of income and managing online transactions remained a problem for tax agencies.

Currently, Vietnam has around 100 cross-border e-commerce platforms with 139 operators. Around 40 are e-commerce platforms for online shopping and nearly 100 for providing services, with some 3.5 million visits per day on average.

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