China tightens taxes on sellers on e-commerce platforms

VTV.vn - China tightens taxes on online sellers, requiring e-commerce platforms to provide revenue data to combat tax evasion.

Workers pack goods at an Alibaba logistics branch in Wuxi, Jiangsu province, China. (Photo: AFP/VNA)

For the first time, China's tax authorities have required major e-commerce platforms, including Amazon, AliExpress, Temu, and Shein, to provide revenue data from their domestic sellers. The goal is to prevent underreporting of revenue to evade taxes and to strengthen management of cross-border business.

The platforms have begun handing over data, giving tax authorities an accurate picture of the actual scale of their businesses. Many sellers reported that after the data was provided, they received messages, calls, and even visits from tax officials demanding tax payments. Faced with this pressure, some businesses chose a "wait and see" strategy to assess the tax authorities' resolve.

Under current law, companies with annual revenue exceeding 5 million RMB (approximately $703,000) are subject to a VAT rate of up to 13%, not including corporate tax. To qualify for tax exemption, sellers need to provide valid export documentation – a requirement many online businesses struggle to meet. Failing to accurately declare actual data can result in many sellers losing their profit margins entirely.

The surge of Chinese sellers entering the global market is evident. The September Marketplace Pulse report showed that, for the first time, Chinese sellers accounted for more than half of Amazon's global sales. The tax collection comes as China's budget needs to increase revenue while simultaneously supporting small-scale exporters facing pressure from international trade barriers, including the US removal of de minimis duty exemptions.

This move is seen as the next step in China's comprehensive efforts to strengthen tax collection and combat tax evasion, following measures on overseas income and the implementation of the Common Reporting Standards (CRS) system.

Source: https://vtv.vn/trung-quoc-siet-thue-voi-nha-ban-hang-tren-san-thuong-mai-dien-tu-100251114155011079.htm