Review the processes and procedures of e-commerce activities to expand and cover revenue sources

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According to data in the White Paper on e-commerce (e-commerce) of the Ministry of Industry and Trade, the total value of e-commerce goods and consumption in Vietnam achieved outstanding growth from 8 billion USD in 2020 to 16.4 billion USD in 2022 and are likely to grow 35% per year, expected to reach 21.3 billion USD in 2023 and 57 billion USD in 2025.

Assessing the impact of e-commerce development on tax management, Director General of the General Department of Taxation Mai Xuan Thanh said that the rapid and explosive development with many new forms of e-commerce in recent times has poses new and significant challenges for tax agencies at all levels in tax management.

Specifically, the ability to fully manage revenue sources, determine tax payers, determine tax bases, clearly distinguish types of income as a basis for taxation, and control business transactions to manage taxpayers and cash flow control is also not easy.

To strengthen the management of e-commerce activities and business activities on digital platforms, General Director Mai Xuan Thanh affirmed that it is necessary to re-evaluate the work that has been implemented, the results achieved, and new problems arising from management practices to build more effective solutions in the period 2024-2025.

Based on initiatives in management, implementation practices, and proposals on solutions to improve efficiency in tax management for e-commerce activities at some key Tax Departments, it is necessary to synthesize, propose more effective solutions in the coming time to ensure that in the period 2024-2025, the Tax industry will build an effective tax management model for e-commerce that meets the characteristics of the digital economy, being compatible with international practice.

According to the General Department of Taxation, on March 21, 2022, the General Department of Taxation opened an e-Portal for foreign suppliers (Etaxvn.gdt.gov.vn) to support foreign suppliers in registering, declaring, paying taxes directly from anywhere in the world. According to the report on the results of implementing the tax management project for e-commerce activities, by the end of the third quarter of 2023, there were 74 foreign employees who had registered taxes, declared taxes on the e-portal for foreign suppliers and paid taxes with total tax amount about 11,498 billion VND.

Along with that, the e-commerce information portal was also officially operated by the General Department of Taxation on December 15, 2022 to receive information about organizations and individuals doing business on e-commerce exchanges.

Up to now, after 4 periods of providing information, the E-commerce Information Portal has recorded 357 e-commerce exchanges providing information. According to information provided by the e-commerce exchanges, the number of organizations and individuals participating in business on the flatforms is more than 191 thousand with a total transaction value of nearly 59 trillion VND.

These are important steps of the Tax sector to realize the national digital transformation goal by 2025, with a vision to 2030. The Tax sector has been making efforts to expand the implementation of electronic tax services, including : tax declaration, tax payment, electronic tax refund, support for searching tax obligation information to facilitate taxpayers in general, and e-commerce business taxpayers in particular, in complying with tax obligations.

According to feedback from local tax departments, in addition to the results achieved, the problem of coordinating with commercial banks to exploit information, determine transaction value and exploiting information from transportation intermediaries and payment intermediaries still face many difficulties.

According to Deputy Director General of the General Department of Taxation Mai Son, tax management for e-commerce is a new and difficult issue not only for Vietnam but also for most countries in the world. Therefore, to manage this activity well, Deputy Director General of Mai Son requested that in December 2023, the Policy Department (General Department of Taxation) needs to review all processes and procedures for e-commerce activities to expand and cover revenue sources.

In addition, the entire sector needs to promote propaganda and handle violations, with the focus being on raising taxpayers' sense of responsibility, and having policies to encourage taxpayers to voluntarily comply with tax laws, and simultaneously publish information on cases of deliberate delay and failure to declare and pay taxes to the state budget.

In addition, departments and units need to speed up connection with the Ministry of Industry and Trade, the inspection and supervision agencies of the State bank and commercial banks to share information about high-frequency and suspicious transactions.

At the same time, clean the data to connect with the national population database (Project 06). Local Tax Departments need to advise the People's Committee to direct departments and branches in the locality to coordinate closely with tax authorities in implementing tax management for e-commerce activities.