AI tool to help Vietnam curb tax evasion by e-commerce platforms: Deputy PM

An artificial intelligence (AI)-based tool will be used to check revenues and trades on e-commerce platforms operating in Vietnam as part of a broader attempt to prevent tax losses, says Deputy Prime Minister Ho Duc Phoc.

Cross-border platforms will be a particular target, he said Tuesday at the ongoing National Assembly session.

He said tax authorities have deployed a wide range of measures to prevent tax losses in the e-commerce sector. As many as 102 foreign Internet-based service providers including Meta (the parent of Facebook), TikTok, Netflix, and Google have filed and paid taxes via the taxman’s e-portal.

Since March 2022, when the e-portal was launched, the foreign service providers have paid VND18.6 trillion ($734.5 million) in taxes, he added.

Tax collection from domestic e-commerce platforms began earlier this year. In Hanoi, tax authorities had collected some VND35 trillion ($1.38 billion) as of early November.

Last week, Phoc had said that the government will drop a value-added tax (VAT) waiver for items worth less than VND1 million ($39.49) each imported via e-commerce platforms.

The intention was announced in the context of booming sale of thriving cross-border e-commerce while government agencies were struggling to oversee operations of unlicensed platforms like Temu, Shein, and 1688.

Dang Ngoc Minh, deputy head of the General Department of Taxation under the finance ministry, said at a press meeting late September that e-commerce platforms will have to declare and pay taxes on behalf of sellers per the new version of the Tax Management Law.

In a related move, Hanoi police last weekend initiated criminal proceedings against Do Manh Cuong for having generated VND160 billion ($6.32 million) by selling phones and spare parts on local e-commerce platforms, avoiding tax payments estimated at VND2.5 billion ($98,700).