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New Tax Rules for E-Commerce Businesses in Vietnam
Vietnam’s Ministry of Finance has proposed new regulations to streamline tax administration for businesses operating on e-commerce and digital platforms. The draft decree aims to ensure fair taxation across all business models while leveraging technology to enhance tax compliance.
Why These Changes Matter
With the rapid expansion of Vietnam’s digital economy, the government seeks to:
✔ Increase tax revenue from online businesses.
✔ Level the playing field between traditional and digital commerce.
✔ Ensure tax compliance among individuals and households selling on e-commerce platforms.
✔ Enhance data-driven tax management using e-commerce platform technology.
✔ Simplify tax procedures to encourage voluntary compliance.
✔ Prevent tax evasion in online business activities.
Who Is Affected?
The proposed regulations apply to:
1️⃣ Vietnamese and non-resident individuals conducting business on e-commerce and digital platforms.
2️⃣ E-commerce platform operators managing payment transactions, responsible for tax deduction and remittance.
3️⃣ E-commerce platforms without payment functions, which are not required to deduct taxes but must report transactions.
4️⃣ Vietnamese tax authorities and other relevant regulatory bodies.
Tax Deduction and Payment Responsibilities
Under the draft decree, both domestic and international e-commerce platform operators authorized to deduct taxes must:
✔ Deduct Value-Added Tax (VAT) on transactions based on Vietnam’s tax laws.
✔ Deduct Personal Income Tax (PIT) for business individuals and households before remitting payments.
✔ Ensure compliance with Vietnam’s tax regulations for resident and non-resident sellers.
✔ Report and submit collected taxes to the relevant authorities in a timely manner.
Tax Deduction Rates
The tax deduction rates will be applied as follows:
✅ Value-Added Tax (VAT):
- Goods: 1% of transaction revenue.
- Services: 5% of transaction revenue.
- Transportation & logistics services: 3% of transaction revenue.
✅ Personal Income Tax (PIT) for Residents:
- Goods: 0.5% of transaction revenue.
- Services: 2% of transaction revenue.
- Transportation & logistics services: 1.5% of transaction revenue.
✅ Personal Income Tax (PIT) for Non-Residents:
- Goods: 1% of transaction revenue.
- Services: 5% of transaction revenue.
- Transportation & logistics services: 2% of transaction revenue.
When Will Tax Be Deducted?
✔ Taxes will be deducted before payments are transferred from buyers to sellers.
✔ If a transaction’s revenue classification (goods vs. services) is unclear, the highest applicable tax rate will apply.
✔ Collected tax must be remitted in compliance with Vietnamese tax laws.
How to Declare and Pay the Deducted Tax
E-commerce platforms must submit tax declarations monthly in accordance with Vietnam’s tax administration laws.
✅ Domestic e-commerce platforms must obtain a 10-digit tax identification number (TIN) to declare and pay collected taxes separately for business individuals and households.
✅ Foreign e-commerce platforms operating in Vietnam must also register for a 10-digit TIN to fulfill tax obligations under Vietnam’s Circular No. 80/2021/TT-BTC.
Next Steps for Businesses
✔ Ensure your e-commerce platform complies with Vietnam’s tax regulations.
✔ If you operate a digital platform, prepare to integrate tax deduction and reporting functions.
✔ Monitor updates from the Ministry of Finance regarding the final decree implementation.
✔ Consult tax professionals to align your business with the latest regulatory requirements.
Learn about Vietnam’s New Tax Laws Revolutionize E-Commerce for Foreign Suppliers!
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