Ho Chi Minh City tax department wants restaurant diners to pay by card

The above solution is recommended for large-scale restaurants that need to issue invoices, not for small eateries.

Speaking to VnExpress, Mr. Tran Ngoc Tam - Director of the Ho Chi Minh City Tax Department said that this agency really wants the food and beverage industry and high-end services to use cash registers connected to taxes, not using cash in payments... At the same time, these units must also use electronic invoices to accurately verify actual revenue generated. This is considered a measure to strengthen tax management for business activities in the food and beverage industry and high-end services.

"However, this is just a proposal, and will still need to be approved by relevant units before submitting it to the Ho Chi Minh City People's Committee for submission to competent authorities," Mr. Tam shared.

Explaining the proposal, Mr. Tam said that the above solutions will first be applied to large-scale restaurants that need to issue invoices, not small eateries.

The rate of card payment when eating out is still low. Photo: PV.

According to the Director of the Ho Chi Minh City Tax Department, the Law amending tax laws stipulates that invoices from 20 million VND must be paid through banks. However, according to many proposals, the threshold will likely be lowered to 5 million VND to encourage non-cash payments.

Previously, in 2015 at the Vietnam Electronic Payment Forum, the issue of lowering the threshold from 20 million to 5 million VND was also proposed by Mr. Do Hoang Anh Tuan - Deputy Minister of Finance to the Ministries, branches and the Government. He affirmed that the Ministry of Finance will be responsible for working with the business community to find a mechanism to encourage electronic payments. According to him, this will be the strongest tool to promote electronic payments because in terms of technology, Vietnam's payment infrastructure already allows this.

However, in reality, the rate of people using cards to pay when eating at restaurants in Ho Chi Minh City is still not high. Mr. Sang - Owner of a large seafood restaurant chain in Binh Tan district (with 4-5 branches) said that although he has installed POS machines for about 5 years, the rate of customers paying by card is still very modest, accounting for less than 15-20% compared to paying by cash.

Currently, for customers using domestic cards, the bank charges the restaurant about 2% of the total payment amount. If using Visa or MasterCard, some banks deduct 4-5%.

"When installing the POS machine, we wanted to attract a significant number of customers to use cards, so we were willing to pay high fees to the bank. But after a period of implementation, the number of customers using cards was not high, so the return on investment was not as high as the fees paid," he said, adding that at some point, the restaurant had to collect additional fees from customers to share the costs, causing customers to argue.

That's not to mention some other reasons such as some restaurant staff being cold, not liking customers using card payments because they are afraid of not being given a tip, or the customers themselves are afraid of the risks when swiping cards...

Faced with this reality, an expert said that, in parallel with the solutions proposed by the Tax Department, the Ministry of Finance should have a tax reduction policy or similar to encourage transaction points to make card payments...

According to Deputy Governor of the State Bank Nguyen Kim Anh, in recent times, non-cash payment activities in Vietnam have not developed commensurate with their potential, but they have been making progress, especially with breakthroughs in the development of modern electronic banking services. The proportion of cash in total means of payment has tended to decrease, from 14.02% in 2010 to 11.45% in August 2017.

The State Bank also actively coordinates with relevant ministries and branches to deploy the development of non-cash payments and electronic payments; solutions to strengthen management, supervision, ensure security, safety and reliability of payment systems according to international supervision principles.

In addition, the State Bank Payment Department also said that up to now, in Vietnam, there have been over 41 commercial banks providing mobile payment services with the number and value of transactions growing rapidly. In the first 9 months of the year, the number of mobile payment transactions reached over 90 million, with a transaction value of over VND 423,000 billion (equivalent to 93% and 139% compared to 2016).

Grasping the trend of payment technology development in the world, a number of banks and information technology and telecommunications companies in Vietnam have researched, cooperated and applied new and modern technologies on mobile devices such as fingerprint authentication, facial recognition, biometrics, QR Code, Tokenization, contactless payment, mPOS technology,...

At the same time, the State Bank directed the pilot implementation of the development of a number of forms of non-cash payments (including payments via mobile phones) in rural areas to expand and promote non-cash payments in rural areas, remote areas, and islands.

According to VNE