Marketplaces face new turnover tax to level playing field for domestic e-retailers and high streets
Vietnam has announced a 1.5% on the income of non-resident marketplaces from their income on sales to Vietnamese consumers. The aim is to level the playing field for local online and high-street merchants who must incur and charge local taxes and Value Added Tax.
Non-resident providers of digital services to Vietnamese consumers are already subject to VAT since 2020.
In the reporting requirements, marketplaces will have to report monthly on the following data:
- Third party seller details
- Revenues by seller
- Goods sold
Bank accounts where funds are transferred for on platform sales
Vietnam’s online market has expanded 18% in the last year to almost US$ 20billion. It has been the fastest growing e-commerce market in Southeast Asia. VAT Calc’s global VAT and GST on digital services blog keeps a live update on how countries are imposing indirect taxes on non-resident providers and electronic marketplaces.
Asia Pacific Digital Services Taxes (DST)
|Country||Status||Rate||Annual sales threshold||Scope|
|In-country income||Global income|
|India||Jun 2016||6%||Rs 2cores||n/a||Advertising|
|India||Apr 2020||2%||INR 20m||n/a||Goods and digital services sellers and facilitating marketplaces|
|Laos||Feb 2024||TBC||Streaming; ad's; travel & hotel online|
|Nepal||Jul 2022||2%||Electronic & digital services|
|New Zealand||Proposed||2-3%||NZ$3.5m||NZ$1.1bn||Social media; Content sharing; Search engine; user data; Intermediation;|
|Pakistan||Sep 2021||2%||Nil||Nil||Withholding tax on marketplaces|
|Kyrgystan||Jan 2022||2%||Nil||Nil||Tax on digital services B2B and B2C|
|Sierra Leone||Jan 2021||1.5%||Digital and electronic services|
|Vietnam||2021 TBC||1.5%||Ecommerce tax on marketplace revenues|