Propose online sales floor to deduct seller's tax when order is successful

E-commerce platforms and digital platforms must declare and pay taxes on behalf of sellers, according to Law 56 amending a number of articles of the Law on Tax Administration, passed by the National Assembly in November 2024. This regulation will be applied from April 1.

In the draft Decree on tax management for e-commerce business, the Ministry of Finance proposed that organizations managing domestic and foreign online retail platforms be allowed to deduct and pay value-added tax (VAT) and personal income tax of sellers for each transaction on the platform. The above taxes will be deducted as soon as the order is successfully confirmed and the buyer accepts payment.

The tax amount is determined as a percentage of the revenue of each completed transaction. For example, VAT on goods is 1%, services 5%, transportation, services associated with goods 3%.

As for personal income tax for resident individuals, the tax rate is 0.5% for goods, 2% for services, 1.5% for transportation and services associated with goods. Non-resident individuals are subject to personal income tax when selling goods on online platforms at 1%, 5% for services, 2% for transportation and services associated with goods.

In case the platform management organization cannot determine whether the transaction is goods or services, the withholding tax will be at the highest rate.

Commenting on the draft decree, the Vietnam E-commerce Association (Vecom) and many platforms such as Grab, Lazada, and Shopee said that the platforms do not have the basis, information, and authority to determine whether a business individual is a resident or not.

Vecom proposes to apply a uniform withholding tax rate, regardless of the seller's residency status. Individuals are then required to file their income tax returns annually so that the regulatory agency can determine the tax group and the final tax rate.

However, the Ministry of Finance said the draft stipulates that individuals and business households on the platform must provide complete and accurate identification code or passport information. This is the basis for the platforms to determine whether an individual is a resident or not.

Regarding the deduction level, according to the Ministry of Finance's Law on Value Added Tax, personal income stipulates a specific taxable percentage. Therefore, the draft decree must follow this principle, the Government does not have the authority to set a different rate than the law.

Previously, Vecom proposed that the National Assembly consider and allow the effective date to be postponed to July 1. However, the Ministry of Finance still plans to implement this decree from April 1.

E-commerce platforms have grown rapidly in recent times, gradually becoming important sales and service channels for businesses and individual traders. According to the Department of E-commerce and Digital Economy (Ministry of Industry and Trade), 61% of internet users said that e-commerce platforms are their preferred online shopping channel.

According to data from more than 400 e-commerce platforms, the country has about 500,000 organizations and individuals doing business on these platforms. Last year, the tax sector collected more than VND116,000 billion from e-commerce, of which the revenue from households and individuals doing business was only about VND2,500 billion.

In addition to identified business organizations and individuals, there are more than 300,000 booths with unidentified users with revenue of over VND 70,000 billion. According to the Ministry of Finance's estimate, the tax collected from this group is about VND 1,000 billion when applying the regulations on deducting and paying on behalf of the floor.

HQ (according to VnExpress)

Source: https://baohaiduong.vn/de-xuat-san-ban-online-tru-thue-cua-nguoi-ban-khi-don-hang-thanh-cong-408250.html