Selling products from 1 million VND or more on Facebook have to pay tax?

To manage tax collection for individuals selling goods online, the Ministry of Finance proposes that a product with a value of 1 million VND/time or more will be subject to value added tax and personal income tax at a rate of %;and no tax is collected on a product with a value of less than 1 million VND/time.

The draft also clearly states: In case a product is under 1 million VND and the transaction frequency is 2 times/day, value added tax and personal income tax will be collected according to regulations.

The Finance sector also requested foreign network operators in Vietnam to set up contact points such as opening official representative offices to coordinate more closely with Vietnamese state management agencies.

Specifically, the Ministry of Information and Communications is requested to coordinate with the Ministry of Finance to request foreign suppliers (such as Google, Facebook, Apple, etc.) to declare and pay contractor tax on services that foreign organizations provide to organizations and individuals in Vietnam.

In case a product is under 1 million VND, transaction frequency is from 2 times/day, VAT and personal income tax are collected according to regulations.

The newly published draft also requests that management agencies coordinate and exchange information with tax authorities of other countries and with Internet service providers (VDC, FPT, Mobifone, Vinaphone, Viettel, etc.) to grasp the quantity and value of e-commerce transactions and bank payments in transactions.

The Ministry of Finance believes that current tax management for online business types faces many difficulties in management such as difficulty in accurately determining taxpayers, revenue generated, grasping the scale of business activities, grasping the entire transaction process, etc.

On the other hand, Internet operations are cross-border transactions, foreign network operating companies are mostly not registered for business and do not have official representative offices in Vietnam.

Staff are delivering goods to customers via online shopping.

According to statistics from the authorities, Google and Facebook currently provide online advertising services to the Vietnamese market through two methods. One is through agents in Vietnam, in this case, the above businesses will have to fulfill tax obligations when generating revenue.

According to Ho Chi Minh City Law Newspaper