Pham Thanh Kien, director of the HCMC Industry and Trade Department, at a working session with Deputy Minister of Finance Nguyen Thi Mai on February 19 said there are about 80,000 e-commerce websites in the city, half of which have stable operations, but the tax collected from the websites remains modest. 

He admitted that it is nearly impossible to collect tax from sales on Facebook.

Mai said that only 26 percent of foreign invested enterprises have tax declarations that show income to be taxed. 

“Is this a sign of wrong declarations?” Mai asked, requesting taxation agencies to apply  measures to supervise tax declarations by the enterprises.

HCMC authorities are considering working with Facebook on a policy which would control revenue from sales on the social network.

This is not the first time the failure of collecting tax from sales on Facebook is mentioned.

In October 2016, at the workshop on management of e-commerce services provided across the border, Nguyen Thi Cuc, chair of the Vietnam Tax Consultancy, pointed out that thousands of ads and sale stalls on Facebook from which Vietnam cannot collect tax.

Meanwhile, in principle, all the production and business activities, including trade and advertisements, must fulfill tax duties.

Vu Tri Dung, a marketing lecturer at Hanoi Economics University, commented that Vietnamese have to pay tax and worry about consumption of unsafe food, while the trading of safe products on Facebook is not taxed.

“Food hygiene is always a burning issue in Vietnam. People have to pay tax, but they still have to live with unsafe food. State management agencies are to blame,” he commented.

“The agencies, living on people’s taxes, still cannot fulfill their duties. As a result, people have to exchange products with each other. Of course, the tax collection failure will affect pay to management officers,” he said.

Experts, while agreeing with the HCMC authorities’ view that it is necessary to tax trade activities on social networks, said that it was difficult to do this.

“Controlling business activities on Facebook is just like looking for a needle in a haystack,” said Nguyen Tri Hieu, an economist.

Despite the anticipated difficulties, deputy general director of the General Department of Taxation Nguyen Dai Tri said the agency said a legal document would be issued soon which will show how to tax business activities on the internet.

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