The General Department of Taxation said that e-commerce platform business activities in Vietnam are business activities that must be licensed and subject to state management by the Ministry of Industry and Trade (according to the provisions of Decree No. 52/2013/ND-CP dated May 16, 2013 of the Government on e-commerce (amended and supplemented by Decree No. 85/2021/ND-CP)).
Regarding the field of state management of domestic revenues (including revenues from e-commerce activities), based on the provisions of the Law on Tax Administration and Circular No. 80/2021/TT-BTC, e-commerce platform managers such as Temu, 1688, Amazon... are responsible for registering, self-calculating, self-declaring, and self-paying taxes directly through the General Department of Taxation's Electronic Information Portal (the General Department of Taxation has deployed the Electronic Information Portal for foreign suppliers (NCCNN) since 2022); if it is discovered that NCCNN has declared incorrect revenue, the tax authority will compare data to determine the revenue, request NCCNN to fulfill its obligations and conduct inspections and checks according to regulations if there are signs of fraud or tax evasion.
Regarding Temu, on September 4, 2024, Elementary Innovation Pte. Ltd (owner and operator of Temu e-commerce platform in Vietnam) registered for tax via the General Department of Taxation's e-Portal for Foreign Employees and was granted tax code 9000001289.
According to the provisions of Circular No. 80/2021/TT-BTC, NCCNNs shall declare and pay taxes quarterly. Accordingly, Temu will start submitting declarations from the third quarter of 2024 (the deadline for tax declaration for the third quarter of 2024 is October 31, 2024) to declare revenue from the time it starts operating in Vietnam (it is expected that tax revenue will be generated in October 2024 and will declare revenue in the fourth quarter of 2024 tax declaration period, the deadline for submission is January 31, 2025) if licensed to operate by the state management agency. The General Department of Taxation will closely monitor Temu's revenue declaration to ensure correct and sufficient collection according to regulations.
For foreign-invested enterprises that generate revenue in Vietnam but have not yet registered for tax, tax authorities have been reviewing and taking appropriate measures to ensure effective tax management for e-commerce and digital platform business activities.
However, taking advantage of the concept, currently, some foreign investors claim to have a “permanent establishment” through the establishment of representative offices in Vietnam. This leads to foreign investors not fully performing their tax obligations through the General Department of Taxation's e-Portal. To resolve this issue, the General Department of Taxation has reported to the Government to propose amending the provisions in Article 42 of the Law on Tax Administration No. 38/2019/QH14 to suit the actual occurrence of foreign investors in Vietnam.
The General Department of Taxation said that cross-border e-commerce is a new activity in Vietnam, with many different characteristics compared to traditional business activities. To ensure effective management of this activity, the General Department of Taxation (Ministry of Finance) has promptly researched, advised competent authorities to issue legal basis and deploy the operation of the General Department of Taxation's e-Portal.
Currently, the General Department of Taxation is continuing to assess the practical situation of tax management for foreign-invested enterprises and refer to international experience to continue to perfect the draft Law on Tax Management, Law on amending and supplementing a number of laws, Law on Value Added Tax, Law on Corporate Income Tax, Decree amending and supplementing Decree No. 123/ND-CP on invoices to manage taxes for this activity to ensure effective tax management, correct and sufficient tax collection for foreign-invested enterprises when doing business in Vietnam.
