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Sunday, July 21, 2024

Taxing lucrative livestream businesses remains inadequate

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HCMC – The number of online businesses operating on social media platforms and reporting huge sales may be on the rise, but the taxes collected from these businesses remains modest.

Tran Huu Linh, head of the Vietnam Directorate of Market Surveillance, at a review meeting on July 23 provided further information regarding a police raid conducted early this month on a 10,000-square-meter warehouse in Lao Cai City, where a huge volume of fake, smuggled and low-quality products meant to be sold on Facebook was being stored.

The market surveillance forces and police officers seized over 158,000 items of 237 products. Findings from the forces indicated that the warehouse owner employed over 70 staffers to operate the business mainly using Facebook Live to promote and sell the goods.

The sales staffers handled over 1,000 orders per day, with monthly retail sales exceeding VND10 billion. Moreover, the bank statement of the business provided by the bank’s side to the police revealed that its total revenue over the past two years reached more than VND649 billion.

The livestream method remains popular among online shops as it helps facilitate an interaction between sellers and buyers.

However, while online trading activities are commonplace, taxation agencies find it hard to collect a proper amount of taxes from these businesses.

Le Duy Minh, chief of the HCMC Tax Department, said shopping habits have changed a lot especially after the Covid-19 pandemic was brought under control in the country. Both sellers and buyers prefer online shopping as it is time-saving and economical.

The taxman can coordinate with banks to tax sellers based on their e-transactions. However, tax control over cash transactions is challenging.

To cope with the issue, the HCMC Tax Department has proposed cooperating with the General Department of Taxation to draw up plans to prevent tax losses, including those to monitor online shopping activities.

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