Local digital content firms are claiming of unfair treatment compared to their foreign peers, with Vietnamese companies saying they face many regulations while firms like Google, Facebook and YouTube don’t pay taxes and are unhindered by regulations and policies.

Employees at VCCorp, a local digital content firm based in ​Hanoi. 

Leaders of digital content businesses made the gripes at a forum about the law on information and technology and development orientation held in Hanoi last week.

Nguyen Thanh Hung, director of VTC Intecom, was reported by online newspaper vneconomy.vn as saying that 10 years ago, revenue of digital content from added value services reached 3-4 trillion VND (133-177 million USD). 

The revenue has risen due to the development of television, online services and the shift from traditional advertising to online ads and content on social networks.

Nguyen The Tan, VCCorp’s general director, said total revenue of digital content firms in was about 8-10 trillion VND (352.4-440.5 million USD) a year. 

The revenue could hit 15-20 trillion VND (660.8-881 million USD) a year, including foreign companies in Vietnam.

Tan told the newspaper that the scale of the digital content market in the next five years could reach 1 billion USD and 5 billion USD in the next 20 years.

However, he said 1 billion in revenue for the digital content sector was different than for the garment and textile industry. 

The garment and textile sector could earn only 10 percent or 500 million USD for export revenue of 5 billion USD while the digital content could yield 500 million USD for exporting 1 billion USD to foreign markets.

This means 1 billion USD exports of the digital content sector could be equal to 5 billion USD in exports of the garment and textile sector, he said.

He forecast that the digital content sector could bring benefits for Vietnam in tourism in the next five or 10 years, surpassing garment and textile and petroleum sectors while providing a million jobs.

Hung from VTC Intecom said there were some restrictions on domestic digital content development, as the Government imposed tight regulations on the sector.

He said his company was inspected by many management agencies when they made information websites. However, there was no one checking their company’s information which was posted on Facebook.

In addition, Vietnamese online game producers have to complete many administrative procedures.

Digital content has also shifted from PC to mobile, meaning management policies are no longer suitable with reality. Digital content on mobile is subject to both Vietnamese and foreign regulations, he said.

He added that this was why local digital content firms have not paid much attention to investment.

Agreeing, Nhan The Luan, a representative of Nhaccuatui, said Vietnamese businesses have faced competition from foreign firms while being restricted by regulations.

Luan said that total traffic of 300 licensed websites in Vietnam accounted for only 20 percent compared with foreign firms which have not been locally licensed.

Tan from VCCorp also said Vietnamese companies had to follow regulations and could be punished for violations while these are not applied on foreign firms.

He added that Vietnamese enterprises have to pay all kinds of taxes such as VAT, individual income tax and corporate income tax.

Tan said taxes should be imposed on both Vietnamese and foreign firms.

In addition, he asked the Ministry of Information and Communications to ask the Government to consider the digital content sector a key economic sector to not only maintain State budget collection but also attract foreign investment.

The ministry should also study policies to make foreign companies follow Vietnamese laws and regulations as they earn billions of VND from Vietnam without paying taxes and duties, he said.

He asked for administrative procedure simplification to reduce the burden on local companies.

Nguyen Xuan Cuong, vice chairman of Vietnam Digital Communications Association said laws and regulations should be adjusted to ensure fairness for both domestic and foreign businesses.

VNA