Vietnam to strictly control imports via e-commerce platforms

Prime Minister Pham Minh Chinh has directed the finance ministry to collaborate with the trade ministry to explore solutions for stricter control over imports via e-commerce, ensuring compliance with Vietnam's international commitments.

In a dispatch issued on Tuesday, the government leader expressed concern that the increasing volume of goods imported via e-commerce platforms is putting significant pressure on domestically-made products, affecting the sales and competitiveness of local businesses.

In recent years, Vietnamese consumers have become accustomed to purchasing goods from foreign sellers online through two main channels: international shops on domestic e-commerce platforms such as Shopee, Lazada, Tiki, and TikTok Shop, and cross-border retail platforms like AliExpress, Shein, and Temu.

Based on gross merchandise volume (GMV), e-commerce research firms reported that international shops account for over 10% of the market share on domestic e-commerce platforms.

Data collected from Shopee, Lazada, Tiki, and TikTok Shop between April and September 2024 by EcomHeat, a subsidiary of YouNet ECI - an e-commerce consulting company, showed that more than 12% of products sold were shipped from overseas.

To address this growing trend, the government is proposing amendments to the Tax Administration Law, aiming to tighten regulations on e-commerce and digital platform trading.

The proposal requires overseas suppliers - whether they have a physical presence in Vietnam or not - to register, declare, and pay taxes.

E-commerce platforms would also be required to declare and remit taxes on behalf of sellers. Additionally, the government is considering removing the VAT exemption for imported goods valued under VND1 million ($40) that are sold through e-commerce platforms, in an effort to prevent tax evasion.

Beyond e-commerce, the government is also concerned about ongoing global economic challenges. The Prime Minister highlighted the risk of further supply chain disruptions and fluctuations in oil prices, as well as weak domestic demand.

Several energy and real estate projects remain stalled, and domestic production, particularly in agriculture, continues to face difficulties, exacerbated by the aftermath of super typhoon Yagi, he noted.

As a result, the cabinet leader has instructed relevant ministries to implement measures aimed at stimulating domestic consumption and strengthening the local market.

The Ministry of Industry and Trade has been tasked with executing effective policies to balance supply and demand, stabilize the market, and encourage consumption. It has also been asked to enhance state oversight of domestic trade, with a focus on market inspection and control, as well as support businesses in addressing issues related to trade defense investigations, origin fraud, smuggling, and counterfeit goods.

The Governor of the State Bank of Vietnam has been ordered to direct financial institutions to develop consumer-focused products and services. Meanwhile, the Minister of Construction has been tasked with exploring mechanisms and policies to encourage the consumption of domestically-produced building materials.