- Tram Ho
On July 19, 2019, Mr. Rafael Frankel, Director of Public Policy Management, Facebook’s Emerging Markets had a meeting with the Vietnamese press to produce a Facebook message committed to investing and supporting Vietnam. Male performs a national vision with areas including digital economy, digital citizens and digital connections.
Undeniably the Facebook platform is contributing greatly to the promotion of the digital economy, digital connection for Vietnam, but from a different perspective the Vietnamese market is bringing a significant source of revenue to Facebook. Therefore, it is clear that which market Facebook business will have to comply with policies in those markets, including tax policy.
Answering ICTnews regarding that Facebook is collecting US $ 600 million per year without complying with Vietnamese law, including the non-tax issue on this revenue, Mr. Rafael Frankel said that Facebook complies with tax regulations. in all countries where Facebook is present, including Vietnam.
Next, ICTnews asked more questions that many businesses and individuals in Vietnam pay for advertising directly via Visa, so how does Facebook pay this money? In response to this question, Mr. Rafael Frankel still only gave the answer Facebook has contributed fully to the tax regulations of the Government of Vietnam.
On Facebook’s support page, there is also information on tax policies for the markets where this social network is present, but there is no information on the tax policy that this platform implemented in Vietnam.
Reply ICTnews on the afternoon of July 19, 2019, Mr. Nguyen Van Phung – Director of the big enterprise tax administration department, the General Department of Taxation (Ministry of Finance) said that enterprises advertising on Facebook must be responsible for deducting FCT.
Information on VTCnews newspaper said that although the revenue was terrible, but Google, Facebook did not pay taxes in Vietnam, not only that, pushing the obligation to pay taxes to domestic partners. Answering VTC News, a leader of the General Department of Taxation, said the agency is developing a project to have appropriate management solutions and anti-tax collection from transnational businesses such as Google, Facebook. However, he admitted that the difficulty in tax collection is that businesses operate transnationally and do not register their business as well as have no official representative office in Vietnam.
According to Assoc. Prof. Ngo Tri Long – former Director of the Price Market Research Institute (Ministry of Finance), businesses such as Google and Facebook, are having great revenue but do not pay taxes or push their tax obligations. Local partners have caused inequalities in business activities. “Last time, the contractor tax collected by the tax authorities is not paid by foreign businesses like Google and Facebook, but it is Vietnamese businesses who close it. This is very unreasonable”, Associate Prof. Dr. Ngo Tri Long said. Still according to the former Director of the Price Market Research Institute, the reason comes from the fact that our tax policy has many open points, so we have to quickly modify the policy to fill this gap immediately.
“It is impossible for foreign businesses to do business and benefit in our country but do not pay taxes, leading to unfair competition and causing inequality in implementing tax obligations”, Mr. Ngo Tri Long emphasize.
Earlier, Giaoduc.net newspaper quoted Mr. Nguyen Van Phung – Director of the big enterprise tax administration department, the General Department of Taxation that Facebook social network is benefiting greatly in Vietnam, but shirk tax obligation.
Mr. Phung pointed out: “The cost of advertising for Facebook, we lose two resources. The first is the tax of individuals doing business through social networks. According to regulations, business individuals must declare and submit tax for the state, but they sell through Facebook and avoid sales, the state only collects taxes on individuals who sell goods via social networks from VND 100 million / year or more.
Moreover, it is very difficult to collect tax on business people via Facebook. Because the tax industry will not be able to access each person’s Facebook but it is obtained because of lack of evidence and information. Secondly, individuals and organizations pay for advertising for Facebook through credit cards, the tax authorities do not know. Thus, the State budget loses 2 taxes, taxes from individuals doing business on social networks and the second tax is Facebook receiving money from individuals doing business via social networks in Vietnam but not with contractor tax. “.
Mr. Nguyen Van Phung stressed: “Individuals pay for Facebook, which means our country loses a resource, that is to pay to foreign countries and people will not enjoy. Facebook must have a great agency. How to manage him, inform him how Vietnamese law can do and not do anything, and victims of social networks through Facebook to reflect and complain. Vietnam is a sovereign country, Facebook has to register with Vietnam, he came to my country, he reached out to receive money from my country, must have a duty to declare “.
Also according to Mr. Nguyen Van Phung, if Facebook claims enough, the tax industry will collect full value-added tax if advertising is 10%, and corporate income tax of 20% / net interest.
Assuming that Facebook collects 100 million US dollars, it must pay 10% value added tax. If they get 10% profit then we have about 2 million USD more.
In Vietnam Facebook has 60 million users and is the largest social networking platform in Vietnam and in the world.
Source : Genk