Tax management from livestream sales activities is still difficult - Lang Son Newspaper: Latest news on politics, economics, society, culture

Since the beginning of the year, tax management revenue from organizations and individuals with e-commerce business activities has been 1.98 million billion VND, with nearly 55,000 billion VND in taxes paid.

The trend of e-commerce business is growing very strongly, however, due to the specific nature of e-commerce, tax authorities encounter many difficulties in the process of managing and collecting taxes for this field, especially the livestream sales activities that are flourishing on e-commerce platforms as well as social networking sites.

Vietnam's current tax policy for e-commerce includes value added tax, corporate income tax and personal income tax.

In recent years, tax policies on e-commerce have been gradually improved, in line with consumer trends and the application of technology in e-commerce business in Vietnam.

According to the Ministry of Industry and Trade , Vietnam's e-commerce growth rate is ranked among the top 10 countries with the highest e-commerce growth rate in the world (as of December 2023 according to Statista).

There are about 61 million people participating in e-commerce shopping, bringing the average shopping value of each person to 300 USD/person/year.

Notably, the active emergence of e-commerce platforms such as Shopee, Lazada, Tiki, Tiktok Shop, Sendo... has contributed greatly to the breakthrough development of e-commerce, especially promoting strong growth of cross-border e-commerce.

According to statistics from e-commerce data platform Metric, in the second quarter of 2024, the estimated total revenue on the 5 largest online retail e-commerce platforms in Vietnam including Shopee, Lazada, Tiki, Sendo, Tiktokshop reached about 85,000 billion VND, an increase of 78% over the same period in 2024.

Deputy Prime Minister and Minister of Finance Ho Duc Phoc said that Vietnam's total e-commerce revenue is currently around 20.5 billion USD and will reach 30.5 billion USD by 2025.

Vietnam is identified as the country with the fastest growth in e-commerce in Southeast Asia. This raises requirements for tax management, product quality management, and anti-fraud on e-commerce platforms.

According to Mr. Dang Ngoc Minh, Deputy General Director of the General Department of Taxation (Ministry of Finance), the rapid and explosive development and many new forms of e-commerce in recent times have created a large potential for increased revenue from e-commerce.

Tax management data in the last 2 years recorded tax collection results from organizations and individuals with e-commerce business activities in 2022 was 83,000 billion VND; in 2023, the amount of tax paid was 97,000 billion VND.

Since the beginning of the year, tax management revenue from organizations and individuals with e-commerce business activities has been 1.98 million billion VND. Taxes paid have been nearly 55,000 billion VND, with 103 foreign suppliers registering, declaring, and paying taxes in Vietnam.

However, currently, the tax revenue from this sector is quite modest and not commensurate with the huge revenue of domestic and cross-border business platforms in Vietnam.

This can cause loss to the state budget and create inequality among business people.

Economic experts also believe that the possibility of losing state budget revenue from taxes on e-commerce businesses is very large when management agencies find it difficult to monitor and collect information about online business transactions.

Most organizations and individuals doing e-commerce business in Vietnam do not register their business, making it difficult for tax authorities to monitor, manage, and identify subjects.

In particular, livestreaming and buying and selling goods by individuals on social networking platforms also face many difficulties because the law does not have specific regulations on tax management for these individuals.

Some social media platforms have yet to establish a commercial presence in Vietnam, leading to difficulties in providing information.

Mr. Dinh Trong Thinh, Senior Lecturer of the Academy of Finance, said that Vietnam is losing tax revenue from this sector. Enterprises and individuals doing business on the internet often find ways to avoid taxes, dividing them into many different accounts for business purposes, leading to inaccurate tax declarations that are very difficult to control.

Many social networking sites originate from abroad and have no legal entity in Vietnam, causing many difficulties in obtaining information and collecting taxes.

“Although tax authorities can access information on social media platforms and ask livestreamers to provide bank statements and information on the use of shipping services to request livestreamers to pay taxes, it is very difficult to determine which transactions are from business activities and which are normal civil transactions,” said Mr. Dinh Trong Thinh.

As a coastal province in the Central region, Khanh Hoa Provincial Tax Department also faces many difficulties in implementing tax management for business activities on digital technology platforms today.

Ms. Nguyen Kim Thai Linh, Deputy Director of Khanh Hoa Provincial Tax Department, said that individuals doing e-commerce business on social networking sites often do not register their business, do not have a clear business address or residential address, the name registered online is different from the real name on documents, etc., leading to a lack of information to identify the business entity for tax management.

In addition, cash transactions for purchasing and selling goods also cause many difficulties in controlling purchasing and selling transactions and determining tax management revenue. At the same time, coordination between the tax sector and banks is still limited.

Meanwhile, after a period of implementing e-commerce tax management in the locality, Mr. Hoang Hong Quang, Deputy Head of Lao Cai Tax Department, said that as a border province, the biggest difficulty in tax management for e-commerce activities is exploiting and collecting data to serve tax management.

Taxpayer data on the database is still difficult to exploit, such as tax codes and taxpayer names do not match the TMS tax management system, taxpayer information is not managed by the tax authority, and incomplete information makes verification difficult.

Along with that, currently the sharing and connection of e-commerce information between relevant agencies and organizations with tax authorities is still limited and ineffective.

In particular, according to Mr. Hoang Hong Quang, businesses and individuals doing business have many different business domain names and do business on many digital platforms with different account names; transact through many commercial organizations; do not have a specific business location or address... causing many difficulties in collecting information, connecting information, contacting, and inviting to work.

Or when the tax authority and the taxpayer have contacted to invite them to work, the data have not been agreed upon, leading to difficulties in determining and collecting the tax payable.

Ms. Nguyen Thi Lan Anh, Director of the Department of Tax Management for Small and Medium Enterprises and Individual Business Households (General Department of Taxation) also said that in the digital economy, it is very difficult to distinguish certain types of income, especially copyrights, service fees and business profits.

Along with that, the buying and selling of goods and provision of services through electronic websites takes place anytime, anywhere, on all days of the week, so it is difficult for tax authorities to control business transactions to manage tax collection subjects for e-commerce business activities.

Therefore, in recent times, tax authorities have always focused on developing inspection and examination plans for taxpayers operating in the fields of e-commerce, digital platform business, and online livestream sales.

In the first months of 2024 alone, the tax authority handled violations of 4,560 taxpayers (including 1,274 enterprises and 3,286 individuals), with the amount of tax arrears and fines handled being VND 297 billion./.

Source: https://baolangson.vn/van-kho-quan-ly-thue-tu-hoat-dong-livestream-ban-hang-5020430.html