Foreign service providers including Google, Facebook, YouTube and Netflix will have to pay taxes in Viet Nam. — Photo doanhnhan.vn
Tech giants like Google, Facebook, YouTube and Netflix will have to pay taxes in Viet Nam and they can do it online.
The Ministry of Finance (MoF) has proposed to allow foreign service providers such as Google, Facebook, YouTube, and Netflix to pay taxes online through the web portal of the General Department of Taxation.
The collection of tax from those companies was one of the important parts in the draft circular guiding the implementation of a number of articles of the Law on Tax Administration and the Government's Decree No. 126/2020/ND-CP of October 19, 2020, which were approved by the MoF recently.
Overseas suppliers who have no permanent establishment but conduct e-commerce or digital-based business activities and derive income from individuals and organisations in Viet Nam shall still be treated as permanent entities in the country.
They shall be obliged to make online tax registrations and declarations on the General Department of Taxation’s official portal, and be allowed to open more than one bank account for making tax payments but have one email only to receive tax notifications.
The draft circular also stipulates the obligation of banks and payment intermediary service companies to define transaction accounts of foreign suppliers who have no permanent establishment in Viet Nam to withhold taxes.
According to insiders, Google, Facebook, YouTube, Netflix and the e-commerce platform Alibaba are currently operating and making huge profits in Viet Nam with turnover of up to billions of US dollars.
Previously, the Ministry of Information and Communications (MIC) estimated that Facebook's advertising revenue in Viet Nam in 2018 was about $1 billion but they did not pay tax.
A representative of MIC said: "If the full amount of tax incurred by foreign service providers in Viet Nam is collected, the revenue could reach hundreds of millions of US dollars." — VNS