Reviewing Grab's tax payment in Vietnam

At the regular press conference for the second quarter held on June 16, the Ministry of Finance received a number of questions related to tax compliance of ride-hailing company Grab in Vietnam.

Specifically, Grab Company Limited is a foreign-invested enterprise that has been operating in Vietnam for 9 years. When it first entered the market, Grab's revenue in 2014 was only VND 1.5 billion. However, by 2022, this financial target had increased to VND 6,384 billion.

Reviewing Grab's tax payment in Vietnam - 1 — Due to continuous losses, Grab has not had to pay corporate income tax. (Photo: Chi Hung).

Notably, Grab has not had to pay any corporate income tax to Vietnam while every year transferring hundreds of billions of dong in royalties, management fees... to two related companies, GrabTaxi Holdings Pte Ltd (headquartered in Singapore) and Grab Inc (headquartered in the Cayman Islands, UK).

This reality has raised many questions about the General Department of Taxation's responsibility to review tax obligations for Grab as well as the effectiveness of the Ministry of Finance's current measures to prevent transfer pricing and tax losses for foreign-invested enterprises.

Regarding this issue, Deputy Director General of the General Department of Taxation Vu Chi Hung affirmed that the Ministry of Finance and the tax sector always pay attention to the work of combating transfer pricing to prevent tax losses. According to the Law on Tax Administration, enterprises investing and doing business in Vietnam must fulfill their tax obligations in the form of self-declaration and self-payment.

Regarding Grab, the General Department of Taxation's leaders said they would discuss with the Ho Chi Minh City Tax Department to direct Tax Branch No. 7 - Nha Be (the unit managing Grab Company Limited) to review and evaluate the tax payment obligations of Grab Company Limited, and immediately report to the Ho Chi Minh City Tax Department to submit the report to the General Department of Taxation.

(Source: Zing News)

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