Want to be in the loop?
subscribe to
our notification
Business News
DRAFT LAW LIFTS BANKS’ ROLE IN E-COMMERCE
Payments for e-commerce transactions must be made via banks or authorised payment intermediary services, according to the draft of the amended Law on Tax Management. The draft law, which was recently released by the Ministry of Finance (MoF) for recommendation, aims to better manage and collect taxes on e-commerce businesses, which have developed strongly in Việt Nam in recent years.
Besides the tax agency, it is necessary to have close co-ordination among other relevant ministries and agencies to make tax management more effective, according to the draft law.
Accordingly, the MoF has proposed that the tax department will build databases and apply electronic tax services, such as electronic tax declaration, electronic invoices and online tax payments, ensuring that 100 per cent of taxpayers will have access to these facilities to catch up with e-commerce.
The State Bank of Việt Nam (SBV) will take measures to develop e-commerce payments and to ensure that cross-border services pay through payment service suppliers or licensed payment intermediary services.
The MoF will co-ordinate with SBV in guiding commercial banks to deduct the tax that foreign social networking sites, such as Google, Facebook and YouTube, have to pay when they transfer money from organisations and individuals to the sites.
Under the current legal regulations, every business or individual, regardless of having a business registration certificate or not, that earns over VNĐ100 million (US$4,400) from trading activities, including those on social media operating as e-trading floors, must register, declare and pay taxes. However, tax authorities find it challenging to tax e-commerce businesses as it is not easy to control online business revenues given cash payment is so common in Việt Nam.
Currently, individual traders mainly pay personal income tax based on taxpayers’ declarations. To declare and pay taxes, individual traders must register their tax codes with the tax authorities. But online traders are reluctant to make tax declarations, while the tax authorities’ facilities and personnel for tax inspection and collection are limited, failing to catch up with the swift growth of e-commerce. The common practice of cash transactions in Việt Nam also makes it impossible to determine the exact income of online shops.
In developed countries, tax enforcement and control mechanisms are mostly based on declarations of taxpayers, but most transactions are made via bank accounts rather than in cash, helping secure full and accurate declaration by taxpayers.
Experts therefore suggested that State management agencies should adopt measures to encourage online payment and reduce cash transactions to help oversee revenues of online traders. There should also be closer co-ordination between concerned authorities and intermediary payment banks.
Source: VNS
Related News
![Card image cap](/uploads/news/Security.jpg)
2025 PIVOTAL FOR STOCK MARKET UPGRADE EFFORT
The Ministry of Finance (MoF) is expected to soon publish the entire content of the draft circular amending and supplementing four circulars on transactions, registration, depository, and clearing, as well as operations of securities companies and information disclosure. This move, along with feedback and explanations, aims to meet the criteria for upgrading Vietnam’s stock market.
![Card image cap](/uploads/news/bn-01.jpg)
VIETNAM INTENSIFIES E-COMMERCE TAX SCRUTINY
The department plans to offer guidance for and hold direct dialogues with e-commerce taxpayers to ensure compliance. Efforts will also include updating the e-commerce database, conducting risk analysis, and leveraging artificial intelligence (AI) to manage data and issue alerts.
![Card image cap](/uploads/news/eco2.jpg)
FOOTWEAR EXPORTS SEEN REACHING US$27 BILLION THIS YEAR
This optimistic forecast reflects the industry’s efforts to expand and diversify its markets. Lefaso indicated that Vietnam’s footwear sector will concentrate on traditional markets like the U.S. and the European Union, alongside markets with free trade agreements to maximize opportunities.
![Card image cap](/uploads/news/FDI.jpg)
FDI INFLOW INTO VIETNAM REACHES NEARLY 15.2 BILLION USD
Vietnam attracted nearly 15.2 billion USD in foreign direct investment (FDI) in the first six months of this year, a year-on-year increase of 13.1 per cent, according to the General Statistics Office.
![Card image cap](/uploads/news/Eco4.jpg)
GDP GROWTH REACHES 6.42 PC IN FIRST HALF
Vietnam's economy grew by 6.42 pc in the first six months of 2024, slightly lower than the figure of 6.58 pc in the same time of 2022 within the 2020-2024 period.
![Card image cap](/uploads/news/Eco3%20%281%29.jpg)
CAPITAL FLOWS STRONGLY INTO INDUSTRIAL REAL ESTATE
Industrial real estate has had easier access to bank credit since July, when the State Bank of Vietnam (SBV) reduced the credit risk coefficient for industrial real estate from 200 per cent to 160 per cent, encouraging commercial banks to lend to more projects in the segment.