Headache because of tax on small value imported goods via e-commerce

Cheap items are always favored by Vietnamese consumers to shop on e-commerce platforms - Photo: QUANG DINH

According to the proposal of the Ministry of Finance, import orders via e-commerce with a value of 1 million VND or less will be exempt from import tax, reduced by half compared to the current level of 2 million VND.

However, each individual or organization is only entitled to tax exemption for the total value of goods not exceeding 48 million VND/year.

The proposal immediately caused much debate in the business community as it both created opportunities for consumers to buy cheap goods from abroad and put great pressure on domestic businesses.

Cheap foreign goods have wide access to Vietnam

Ms. Lan, the owner of a large-scale shop on an e-commerce platform, said she had to recalculate her entire business strategy because cheap imported goods would flood in more, competing directly with domestic goods.

Meanwhile, after researching the Tet market, Mr. T., director of a trading company in Ho Chi Minh City, decided to invest heavily in online business, focusing on domestic goods to take advantage of debt, factory discounts and avoid disadvantages from import taxes.

Mr. T. spent a large amount of money to establish a new company, recruit employees, build a livestream room, cooperate with KOLs, KOCs and link with domestic e-commerce platforms to develop B2B and B2C models.

"I think selling domestically will be more profitable, but if the proposal to exempt taxes under 1 million VND is approved, businesses like ours will find it very difficult to compete," said Mr. T., adding that if this proposal is approved, he will be forced to consider changing his business direction.

Not only individual sellers, domestic manufacturing and trading enterprises also expressed concern after receiving this information.

Mr. Le Anh - director of a company manufacturing and processing electrical equipment and electronic accessories in Ho Chi Minh City - said that domestic enterprises must pay import tax on raw materials and goods from abroad, so why are goods imported through e-commerce platforms exempted from tax? "If considering tax exemption, it must create fairness for domestic manufacturing enterprises," Mr. Anh said.

Many experts in the field believe that this proposal could cause the prices of imported products in the 1-2 million VND segment to increase slightly due to additional taxes.

This may reduce the attractiveness of imported goods, while creating opportunities for domestic manufacturers to compete better on price. However, for items under 1 million VND, maintaining the tax exemption policy will help imported goods continue to maintain their advantage on e-commerce platforms.

Ms. Nguyen Thi Anh Hong - e-commerce director of the 24hStore retail system - said that reducing the tax exemption level to 1 million VND could make the low-segment imported goods market more vibrant as sellers focus on products priced below this level to take advantage of the tax exemption policy.

"On the contrary, for items over 1 million VND, prices may increase slightly, changing the shopping habits of consumers, especially young customers who are sensitive to prices," said Ms. Hong.

Worry about Vietnamese goods having difficulty competing

According to Ms. Hong, domestic manufacturers will face stronger competitive pressure from cheap imported goods, especially in the segment under 1 million VND.

This requires domestic enterprises to have a clear strategy to maintain competitiveness. Enhancing brand value becomes a key factor, helping enterprises create differentiation and trust with customers.

"Domestic businesses need to take advantage of after-sales service and warranty to create trust with customers. Compared to cheap imported goods, domestic products have the advantage of genuine warranty and better customer care service. This is a point that domestic brands can strongly exploit to retain consumers," Ms. Hong shared.

Meanwhile, Ms. Dinh Thi Nho - operations director of e-commerce market data analysis platform Metric.vn - said that if the above proposal is approved, the competition between imported and domestic goods will have certain changes.

Citing data from Metric.vn, Ms. Nho said that in 2024, more than 324.1 million imported products were sold through the Shopee platform, generating revenue of VND14.2 trillion, up 37.9% and 42.9% respectively compared to the previous year.

These items are mainly in the beauty and fashion industry with an average price of only about 43,682 VND/product.

This means that most of the current imports are low-value and will remain within the duty-free threshold even if the new rate is applied. “However, for higher-value products, the selling price may increase due to additional import duties,” Ms. Nho said.

Meanwhile, Associate Professor Dr. Nguyen Huu Huan - senior lecturer at Ho Chi Minh City University of Economics - said that many countries have issued strict regulations to "plug loopholes", impose/increase taxes, and respond to the "tornado" of cheap goods flooding into the border through e-commerce channels.

Therefore, it is reasonable to impose value added tax and import tax on small-value goods sold through e-commerce platforms.

"Small-value imported goods are flooding into our country through e-commerce, so we need to collect the right amount of tax.

Otherwise, domestic enterprises will find it difficult to compete and will be disadvantaged at home, contrary to the common determination to develop Vietnam's private economy," Mr. Huan said, adding that customs authorities also need to try to increase the application of technology to avoid congestion, both ensuring tax collection and helping domestic enterprises have a fair playing field at home.

Online sales are booming in Vietnam - Photo: QUANG DINH

Goods under 1 million through the floor will be exempt from import tax.

In the draft decree on customs management of exported and imported goods traded via e-commerce that has just been put out for comments, the Ministry of Finance proposed exempting import tax for orders valued at VND1 million or less, halving the level of VND2 million in current regulations.

Also according to the draft, each organization or individual purchasing goods will only enjoy this policy for no more than 48 million VND/year.

According to the Ministry of Finance, in the latest announcement of the Ministry of Industry and Trade, the growth rate of e-commerce in Vietnam in recent years has increased by 15-20%/year.

In 2024, the size of Vietnam's retail e-commerce market is estimated to exceed 25 billion USD, an increase of about 20% compared to 2023. Vietnam is ranked in the top 10 countries with the highest e-commerce growth rate in the world, after Indonesia (65 billion USD) and Thailand (26 billion USD).

However, the challenge for Vietnam is that organizations and individuals can take advantage of cross-border business to evade taxes, causing loss of budget revenue.

On the other hand, businesses do not need to have a headquarters, conduct transactions electronically and the server can be located abroad, making it difficult to identify taxpayers and the basis for tax calculation.

Authorities have difficulty controlling cash flow because shoppers use cash and cryptocurrency as payment methods.

Mr. Nguyen Ngoc Tu, a tax expert, said that the proposed price of the Ministry of Finance is completely reasonable. Because according to international practice, many countries exempt taxes on imported goods of small value.

Applying a threshold of total import value not exceeding 48 million VND/year will also limit buyers from taking advantage of the policy and importing goods for business purposes. However, Mr. Tu also recommends that it is necessary to evaluate to ensure that the tax collected is equal to the investment in the system, customs infrastructure...

According to trade experts, the number of small value orders imported into Vietnam is very large. Therefore, the Customs Department needs to prepare well the electronic customs infrastructure to facilitate customs declaration when applying this policy.

It is also clear that reducing the value of imported goods exempted from import tax is necessary to ensure the harmony of trade and diplomatic relations between Vietnam and other countries. On the other hand, this policy also contributes to protecting domestically produced goods and ensuring fairness for domestic producers.

Consumers benefit?

The proposal to exempt taxes for orders under 1 million VND has received support from some consumers because everyone wants to buy cheap goods from abroad.

"I don't know what taxes are for businesses and sellers. For customers like me, cheap prices, diverse goods and fast delivery are the priority choices" - Ms. Thuy Dung (Phu Nhuan district, Ho Chi Minh City) shared.

This is also the psychology of users when price factors and diverse designs will attract shopping interest on e-commerce platforms without distinguishing carefully about the origin of domestic or imported production.

However, Ms. Anh Hong warned that some customers may seek to split their orders into smaller ones to take advantage of the tax exemption policy.

This will force e-commerce platforms to have stricter control measures to avoid fraud in declaring order values. However, this is also an opportunity for platforms to promote domestic products of equivalent quality to retain customers.

According to many experts in the field, with products under 1 million VND, consumers can still access imported goods at competitive prices, without additional taxes.

This is especially beneficial for customers looking for cheap technology accessories, smart devices or fast-moving consumer products.

However, for products with a value of more than 1 million VND, the cost can increase, affecting the purchasing decision. Consumers can consider choosing domestic products or switching to brands with better prices.

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Source: https://tuoitre.vn/dau-dau-vi-thue-hang-nhap-gia-tri-nho-qua-thuong-mai-dien-tu-20250401080754609.htm