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Vietnam accuses Netflix, Apple for lack of tax payments

November 13, 2020 | 07:52

Vietnam’s information minister on Tuesday accused foreign streaming companies like Netflix and Apple of skirting their tax responsibilities, saying it would create unfair competition for domestic firms.

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Netflix said it had no plans to place its servers locally or open an office in Vietnam at the moment. (Photo: Getty)

Foreign stream firms, which have combined revenues of nearly 1 trillion VND ($43.15 million) from one million subscribers, according to the information and communications ministry’s calculations, have never paid tax in Vietnam.

According to Minister Nguyen Manh Hung, “Domestic companies have to abide by tax and content regulations while foreign firms do not, which is unfair competition,”. He added that “Some content on Netflix has flouted regulations related to the history and sovereignty of the country, violence, drug use, and sex.”

As stated by Reuters, Netflix said it had no plans to place its servers locally or open an office in Vietnam at the moment, even though Vietnam introduced a cybersecurity law two years ago that requires all foreign businesses earning income from online activities in Vietnam to store their data in the country two years ago. Netflix had no immediate comment when contacted by Reuters and said it would provide a response later.

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ome content on Netflix has flouted regulations related to the history and sovereignty of the country, violence, drug use, and sex. (Photo: VN Express)

“We are supportive of the implementation of a mechanism that will make it possible for foreign service providers like Netflix to collect and remit taxes in Vietnam,” a Netflix spokesperson said in the statement. “However today such a mechanism does not exist.”

According to Vietnam Insider, Hung said the information ministry, finance ministry and tax department were working together to facilitate tax collection by calculating foreign streaming firms’ revenues in Vietnam since their entries into the market.

Tech giants are increasingly facing tougher fiscal regimes in Southeast Asia, where regulators held talks last year on a regional push to tax tech giants more. The Philippines, Thailand and Indonesia have recently passed or drafted legislation hoping to ensure taxes are paid.

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