VietNamNet Bridge - Online booking has been witnessing stable growth in Vietnam in the last few years. However, most foreign tourists and a high proportion of Vietnamese travelers use  services from foreign OTAs (online travel agencies) instead of Vietnamese service providers, according to speakers at the Vietnam Online Business Forum 2017 (VOBF) held several days ago. 


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Online booking is a cross-border e-commerce field that has been developing strongly.

A UN report shows that Asia has up to 1.4 billion people at the golden age of 15-34, including 459 million in India, 414 million in China, 85 million in Indonesia, 35 million in the Philippines and 32 million in Vietnam.

UNWTO (World Tourist Organization) believes the golden population plays an important role in promoting the tourism industry. The organization also says the technology revolution and social media’s effects are important factors that have created the rapid development of tourism in recent years.

Meanwhile, VECOM (the Vietnam E-commerce Association) commented that the strong rise of solo travelers using online booking services has caused big changes to the tourist market. 

This has forced travel firms to apply advanced technology solutions to satisfy the increasingly choosy demands from travelers.

Most foreign tourists and a high proportion of Vietnamese travelers use  services from foreign OTAs (online travel agencies) instead of Vietnamese service providers

VECOM, while noting that online booking has been growing rapidly, pointed out that the market is being controlled by foreign service providers.

Gotadi.com commented that foreign service providers, especially ones from the US, are controlling the online booking market in Vietnam thanks to their advantages in technology, capital and tax avoidance.

Agoda and Booking are the two leading OTAs in Vietnam which hold 80 percent of the booking services, serving both outbound and inbound tourists.

Booking hotel rooms online is a growing tendency in Vietnam. Hotel reports show that about 30-40 percent of guests book rooms online, while the figure could be up to 80 percent for some hotels.

Gotadi estimates that Agoda in 2016 earned VND4 trillion from hotels in Vietnam alone.

In the latest move, the Ministry of Finance has announced it will tax foreign OTAs on the income they earn from providing services in Vietnam. They will have to pay VAT and corporate income tax, which is 5 percent of total revenue.

The decision was released after Vintrip.vn’s CEO Le Dac Lam denounced Agoda for evading tax.

Lam said he took the move because he realized that Agoda’s tax evasion helped it compete with young local firms. Vietnamese service providers have to pay VAT and CIT of 30 percent. 


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