Ho Chi Minh City seeks to tax sales on Facebook

The Ho Chi Minh City Department of Industry and Trade said it will coordinate with the City Tax Department to begin discussing solutions for collecting sales tax on Facebook this month.

» Online business tax, clear law but difficult to collect?

After raising the issue of collecting taxes from Facebook sellers last month, the Ho Chi Minh City Department of Industry and Trade said it is actively promoting discussions on specific measures. Department Director Pham Thanh Kien affirmed that preventing tax losses is one of the major issues today to ensure the city's budget revenue. In particular, e-commerce activities, especially business on Facebook, have not been strictly controlled by state agencies.

“The Department of Industry and Trade is actively discussing with the Tax Department about solutions to manage e-commerce businesses and especially businesses on Facebook. However, this issue requires time because it is not simply a matter of statistics, seeing what people buy and sell, but also depends on technology to manage this website. This March, we will sign a cooperation agreement with the Tax Department on solutions for implementation,” said Mr. Kien.

According to this person, the specific solution will be announced as soon as the relevant agencies have finished discussing and submitted to the City leaders for approval. At that time, the top priority activity is still to call for the self-awareness of sellers on Facebook through media channels.

The Ho Chi Minh City Department of Industry and Trade and the Ho Chi Minh City Tax Department will begin discussing specific solutions to collect sales tax on Facebook in March 2017.

Previously, during the meeting between the leaders of Ho Chi Minh City and the Tax Department in February 2017, the Department of Industry and Trade proposed to find a mechanism to collect taxes on business activities on Facebook. This proposal was later confirmed by the General Department of Taxation to be well-founded. The Tax Policy Department - General Department of Taxation is also researching tax management for business activities on social networks, specifically: Facebook, Youtube, Zalo...

According to many experts, collecting taxes from sellers on Facebook will not be simple. Each organization and individual can currently own many different accounts on social networks for business. Buying and selling is mainly done in cash, so it is difficult to monitor. Not to mention the difficulty in distinguishing what purpose stores use Facebook for, for consulting, marketing or selling products and services. In addition, some people do business on Facebook as a seasonal job or to earn extra income, so how should taxes be managed?

In the immediate future, the general direction of the tax authorities is to require people doing business on social networks to provide information such as name, address, phone number, personal tax code, etc. to be able to more closely control this form of business.

According to VNE