Products ordered online from abroad and sent to Vietnam or vice versa will be subject to import and export tax according to Vietnam's current regulations through shipping units. This is the remarkable content of the Draft Decree on management of export and import goods transacted through e-commerce, which is being sent by the Ministry of Finance of Vietnam for comments from ministries, branches and localities.
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Vietnam: Expected to pay tax when buying foreign goods online
Currently, e-commerce is developing strongly all over the world and Vietnam is no exception to this development. According to the Vietnam E-commerce Association in the report on Vietnam E-commerce Index (EBI) in the last 5 years, the average annual growth rate of Vietnam is from 25-30%. If Vietnam maintains this growth rate, the scale of Vietnam's e-commerce market in 2025 will be the third in Southeast Asia after Indonesia and Thailand.
Buying goods abroad through e-commerce platforms is becoming more and more convenient in terms of both transaction methods and payment and receipt. However, this situation also poses management problems to suit cross-border e-commerce transactions. Therefore, the Ministry of Finance of Vietnam proposes policies to prevent tax evasion when buying imported goods through e-commerce.
According to the Draft Decree, besides the objects similar to the cases of exporting and importing ordinary goods, it additionally stipulates the subjects who are the owners of e-commerce trading floors, commercial websites of e-commerce platforms such as Amazon e-commerce platform in the US, Alibaba e-commerce platform in China. This regulation is similar to the regulations on taxpayers in the Law on Tax Administration of Vietnam. Buyers, owners of e-commerce platforms (or through geographical customs procedures, shipping units) are responsible for customs declaration and tax payment.
Currently, imported goods transacted via e-commerce do not have separate regulations on tax policy, according to current regulations on import tax, imported goods are sent via postal service, service delivery, and customs clearance. Express delivery services (regardless of e-commerce goods or other goods) with a customs value of VND 1,000,000 or less or with a total tax of VND 100,000 or less are exempt from import tax (according to Clause 11 Article 1 of Decree 18/2021/ND-CP of Veitnam). However, Decree 18/2021/ND-CP has not specified the number of times or specific duty-free shipments, which leads to the customs declarant taking advantage of this policy to subdivide shipments for the purpose of tax-free.
Therefore, in order to prevent the abuse of tax incentives, develop regulations to ensure the management, prevent tax evasion and facilitate the import and export of goods through e-commerce. The draft Decree specifically stipulates as follows:
“Each organization or individual purchasing goods is only entitled to tax exemption standards for imported goods specified at Points a and b below with no more than 1 order/day and no more than 4 orders/month :
a) Imported goods have a customs value of 1,000,000 VND or less according to each order ;
b) Imported goods have a customs value of more than 1,000,000 VND per order but the total amount of import tax payable is less than 100,000 VND .
If imported goods transacted via e-commerce have a customs value of more than VND 1,000,000 per order and the total payable import tax amount is over VND 100,000, they must pay import tax for the entire value of imported goods.”
Meanwhile, in order to limit the abuse of tax incentives for goods sent via express delivery and postal services as prescribed in Decree 18/2021/ND-CP as well as to synchronize preferential policies, the Ministry of Finance of Vietnam proposes that the import tax exemption rate for goods sent through the postal service must be applied according to the norms for imported goods transacted via e-commerce.
The draft Decree on management of import and export goods transacted via e-commerce is being widely consulted by the Ministry of Finance of the people as well as relevant agencies.
Bao Ngoc
