Vietnamese Tiếng Việt | Thursday, May 24, 2018 | Advertise with Us
   
Text Size

Booking.com, Agoda must pay tax in Vietnam

Share
(0 votes, average 0 out of 5)

All businesses have to pay tax for income they earn in Vietnam. However, Vietnamese taxation bodies have not found solutions to force foreign online booking agents such as booking.com and Agoda to fulfill their tax duties.

vietnam economy, business news, vn news, vietnamnet bridge, english news, Vietnam news, news Vietnam, vietnamnet news, vn news, Vietnam net news, Vietnam latest news, Vietnam breaking news, online booking, Agoda, tax evasion

All businesses have to pay tax for income they earn in Vietnam

 

Analysts estimate that the agents earn trillions of dong from the Vietnamese market, but don’t pay one dong of tax.

Le Thi Ai Lien from Sai Gon Mui Ne Tourism recently spoke at a dialogue between MOF and businesses on tax and customs procedures.

She said her company signed a contract with Booking.com, headquartered in the Netherlands. The Vietnamese taxation body says in this case, the foreign partner has to pay foreign contractor tax (FCT) and Sai Gon Mui Ne has to withhold money for FCT before paying Booking.com for the website’s services.

However, Booking.com did not accept this, saying that it can have tax exemption in accordance with the agreement on double taxation avoidance between Vietnam and the Netherlands.

The problem for Sai Gon Mui Ne was that the company could not collect more from customers because the prices were quoted, while the foreign partner would break the contract if the company withheld money as requested by the taxation body. Finally, the company had to pay FCT with its own money to Vietnam.

Later, Sai Gon Mui Ne sent all necessary documents, including Booking.com’s residence certificate, to the Binh Thuan provincial Taxation Agency and asked for tax refunds in accordance with the agreement on double taxation avoidance. However, the taxation agency said the case was not subject to tax exemption.

“The taxation body said Booking.com has two resident units in Vietnam, one in Hanoi and one in HCMC. Therefore, it is not subject to tax exemption,” Lien said.

However, according to Lien, the two offices of Booking.com are set up just to explore public opinion and conduct market surveys, and they don’t pay for contracts or do business.

In reply, Cao Anh Tuan, deputy general director of GDT, said in this case, the Binh Thuan provincial taxation agency is right, explaining that once the website sets resident units in Vietnam, it has to pay tax in Vietnam.

According to Tuan, besides Booking.com, other websites that provide online booking services have been earning big money in Vietnam from the commission paid by Vietnamese travel firms and hotels. But they don’t pay tax.

In late 2016, Vntrip.vn, a website which has operations similar to Agoda, accused Agoda of evading tax.

Vntrip.vn estimated that the revenue from hotels in Vietnam alone may reach $21 billion by 2020, of which 50 percent would be from online websites, or $10.5 billion. This means that the state could fail to collect trillions of dong worth of tax.

 

 

Source: Buu Dien - VietNamNet

Maybe You Also Interesting :

» Extending mandate of tax authorities may halt tax evasion?

Handing over the right of prosecution and investigation to the tax authorities is expected to hinder tax evasion as well as delayed tax payments by...

» Hà Nam celebrates Long Đọi Sơn Pagoda Festival

Visitors to Đọi Sơn Commune in northern Hà Nam Province this weekend will have the chance to enjoy the Long Đọi Sơn Pagoda Festival that recently...

» A visit to Quan Âm Pagoda in Bạc Liêu

Pilgrims to the Mekong Delta Province of Bạc Liêu are recommended to make a stop at a Buddhist pagoda with an 11-metre-tall Bodhisattva statue.

Popular News Categories:

- Asia & Asian  |  EU & Russia  |  America & US

- Facts  |  Urban  |  Faculty  |  Environment

- Business  |  Finance  |  Market Health

- Destination  |  Cuisine  |  Arts Music

- Cinema  |  Soccer  |  Sports  |  IT & Internet

Culture & Tourism:

-> About Vietnam  |  Things To Do

-> Destinations  |  Events Calendar

-> Visa Online  |  Flights & Transport

-> Accomodation  |  Tours & Cruise

-> Find more go to Travel.VN...

Login