The Ministry of Industry and Trade and the Ministry of Finance jointly propose solutions to collect correct and sufficient taxes on e-commerce.

There are still many "barriers" in tax collection.

According to the General Department of Taxation, in 2023, the General Department has strongly and effectively implemented tax management for e-commerce and digital business activities. Vietnam has become one of the leading countries in the ASEAN region in collecting taxes through the Electronic Information Portal for foreign suppliers.

Specifically, as of early October 2023, 74 foreign suppliers had registered, declared and paid taxes via the Electronic Information Portal for Foreign Suppliers. Of which, 32 new foreign suppliers registered to pay taxes from the US, the Netherlands, South Korea, Singapore, Switzerland... Big names such as Facebook, Google, Microsoft, TikTok, Netflix, Apple, and Nintendo have all paid taxes directly via this electronic information portal.

The General Department of Taxation said that the total tax paid by foreign suppliers in 2023 was VND8,096 billion, of which VND6,896 billion was declared and paid directly through the electronic portal and VND1,200 billion was deducted and paid on behalf of Vietnamese parties.

In 2023, the General Department of Taxation has strongly and effectively implemented tax management for e-commerce and digital business activities.

Notably, after a year of forcing e-commerce platforms to provide information, in 2023, e-commerce revenue for domestic organizations and individuals reached 536.5 billion VND. Tax authorities also collected and handled violations of about 275 billion VND from 179 enterprises and 1,061 individuals doing business on the platform...

In fact, according to the data in the White Book on E-commerce of the Ministry of Industry and Trade , the total value of goods and e-commerce consumption in Vietnam is expected to reach 21.3 billion USD in 2023 and 57 billion USD in 2025. Currently, about 60% of the population participates in shopping, equivalent to 57 - 60 million consumers shopping online. From this practice, it shows that this field has not been collected properly and fully.

Regarding the challenges in managing tax collection activities on e-commerce platforms today, the Department of E-commerce and Digital Economy said that one of the reasons is that traders and organizations providing cross-border e-commerce services do not have representative offices or legal representatives in Vietnam, so requiring them to comply with Vietnamese e-commerce laws is still facing many obstacles.

“Managing cross-border e-commerce is a difficult issue not only for the Ministry of Industry and Trade but also for other state management agencies such as the Ministry of Finance, the Ministry of Information and Communications, and the Ministry of Public Security. Through information exchanged with the Ministry of Finance, many cross-border e-commerce service providers have not yet declared taxes directly to the tax authorities (for example, the case of Agoda, Booking)” - said a representative of the Department of E-commerce and Digital Economy.

In reality, local tax authorities face difficulties in fully managing revenue sources, identifying taxpayers, determining tax bases, clearly distinguishing types of income, creating a basis for taxation, controlling business transactions to manage taxable subjects and controlling cash flow.

Need for synchronous, inter-sectoral coordination

According to experts, although there are still many difficulties in managing and collecting taxes in the current online business environment, the fact that more and more individuals and business households earn "huge" income from platforms such as YouTube, Google, Facebook..., or on e-commerce platforms and have not paid taxes poses many problems that need to be solved for the authorities.

Ms. Nguyen Thi Lan Anh, Director of the Department of Tax Management for Small and Medium Enterprises, Business Households and Individuals (General Department of Taxation) said that there are currently many problems in the management of e-commerce tax. Households and individuals doing e-commerce business often do not have business registration, tax registration, or a clear business address.

Many cases also use other people's personal information to register businesses, making it difficult to accurately manage the subjects. One subject can have many booths on one platform and many e-commerce trading platforms, as well as social networks, making it difficult to determine the basis for tax calculation.

In many localities, e-commerce platform owners have not provided full information on organizations and individuals doing business on the platform; and have not fully exploited data on the General Department of Taxation's information portal due to limited decentralization.

In cases where businesses hire delivery units to collect sales proceeds (COD), even though a rental contract has been signed, the delivery units have not provided, or provided but have not identified the name and tax code of the selling organization or individual for tax management.

For organizations and individuals residing in the country that generate income from providing cross-border services on digital platforms (producing digital content, digital applications via Google, Facebook, Netflix, etc.), the tax authority sent requests to 56 banks, but only 15 banks responded.

Regarding the solution, according to the General Department of Taxation, in 2024, the General Department of Taxation will study and propose amendments and supplements to relevant legal regulations to strengthen the responsibility in tax declaration, tax payment and information provision to tax authorities of entities related to e-commerce business activities, such as owners of trading floors, foreign suppliers without fixed business establishments in Vietnam, shipping units, banks, payment intermediaries, etc.

The General Department of Taxation is also researching the construction/outsourcing of automatic tools to collect data from online business entities through business websites, trading floors, and social networks.

Complete the database from information sources from taxpayers, tax management information of tax authorities, information from inspection and examination results and information from third parties. Build a risk management model for organizations and individuals doing e-commerce business, thereby applying artificial intelligence to process big data, giving warnings in cases of tax risks.

On the part of the Ministry of Industry and Trade, in addition to continuing to implement directives such as Directive No. 18/CT-TTg dated May 30, 2023 and Decision No. 2232/QD-BCT on promoting connection and data sharing to serve e-commerce development, prevent tax loss, and ensure monetary security, the Ministry of Industry and Trade will strengthen close coordination with the Ministry of Finance and the Ministry of Information and Communications in requiring traders and organizations providing cross-border e-commerce services to comply with the laws on e-commerce, tax laws, and laws on network information security.

At the same time, the joint ministries agreed on measures to handle cases where traders and organizations providing cross-border e-commerce services do not comply with the law, such as publishing information on the media, warning consumers not to use the service, and blocking user access to cross-border digital platforms.

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