The vibrant development of e-commerce has raised the issue of how to effectively manage and avoid tax loss.To prepare for this, the term "e-commerce" and the way of management have been introduced into law by the National Assembly.Specific regulationsare about to officially come to life.

The payment of businesses abroad to Google and Youtube is confirmed
by the tax authority to be well managed

Cooperate to implement from December 5

E-commerce activities mainly arise on the network environment from sales transactions to payments, so the tax agency determined that capturing information from banks will be key to solve the problem of controlling the sales of online stores.

In the Law on Tax Administration No. 38 (Clause 2, Clause 3, Article 27), the National Assembly has included a regulation on the responsibility of commercial banks to provide information about account numbers according to the tax code of the taxpayer when opening an account and deducting; paying tax on behalf of the tax liability of a foreign organization or individual having e-commerce business activities generating income from Vietnam.

Recently, the Government has also issued Decree No. 126/2020 / ND-CP detailing a number of articles of the Law on Tax Administration No. 38, which clearly states that state management agencies are responsible for providinginformation totax authorities.

More specifically, commercial banks are responsible for providing information requested by tax authorities.The provided information is the payment account information of each taxpayer, including name of account holder;account number according to the tax code issued by the tax administration agency;account opening date and account closing date.The provision of account information prescribed above will be done for the first time within 90 days from December 5, 2020.

Speakingabout the responsibilities of commercial banks, Mr. Dang Ngoc Minh, Deputy Director of the General Department of Taxation, said that according to the new regulations, the management efficiency for commercial business transactions improved. In order to combat tax loss, tax authorities need to strengthen coordination with commercial banks to getinformation. Decree 126/2020 / ND-CP does not require the bank to provide all accounts and payment balances for all customers.

The Tax Office will request accounts for specific cases and subjects in the order. Thus, the commercial bank's provision of transaction information via the account, account balance and transaction data is mainly for the purpose of inspection, examination and determination of payable tax obligations and implementation of coercive measures to enforce administrative decisions on tax administration in accordance with the tax law.

In fact, the tax administration and tax collection for e-commerce business are facing many difficulties.Therefore, the implementation of Decree 126 will help tax authorities closely monitor banking transactions, through which there is an effective tax management, preventing tax evasion.

Enterprises have been fulfilling their obligations

In fact, in 2016, Vietnamese commercial banks conductingpayments with the US tax authorities petitioned the State Bank to sign agreements on the exchange of personal account information and property transactionsof people living and residing in the US.Also from that year, commercial banks have been able to track and provide account information.Soasking commercial banks for domestic information is not too difficult.

According to Mr. Dang Ngoc Minh, a principle of tax observance of individuals and organizations is to declare, pay by themselves and be responsible for their own behavior.In all cases, if an individual evades tax in one way or another, they will also be found by the tax agency based on payment "traces", payment records and e-commerce transactions.

In addition, regarding tax enforcement with accounts, Mr. Minh said that the current law allows the implementation of seven coercive measures, including: notice, name, request to pay tax through the account andcontrol invoices. Depending on each case and conditions, the tax agency will consider the most effective method with the ultimate goal of how to correctly and fully collect taxes.

According to Customs Newspaper's knowledge, the tax agency has plans to work with consulting companies and auditing firms to invite businesses such as Amazon, Netflix, Facebook, Google, and Youtube to talk, first of all onnew obligations and exchange management measures in the future.The general spirit is to strictly comply with regulations on tax obligations and the responsibility of businesses to pay value added tax and corporate income tax on the services provided to Vietnam.

Particularly with Netflix, the tax agency had a meeting. “They have discussed applying some international practices.One thing is that they have to pay taxes in Vietnam.We will wait for a general circular.After consensus checking, we will calculate Netflix's obligation fulfillment, based primarily on corporate claims.In this case, it is necessary to support banks to have statistics on the payment flow for Netflix,” said Deputy Director of the General Department of Taxation.

The payment of businesses abroad to Google and Youtube is confirmed by the tax authority to be well managed.Enterprises have been fulfilling their obligations.The problem is that for individuals in Vietnam, the collection does not reflect the reality, so the tax office will continue to focus on this.