Vietnam’s VAT Rules for E-commerce & Digital Platforms: Key Changes

February 27, 2025

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The Vietnamese Ministry of Finance opened a public consultation on a draft law amending the tax regulation for domestic and foreign e-commerce digital platforms. The proposed amendments aim to increase the efficiency of tax collection from e-commerce platforms, digital platforms, and other digital economic activities. New VAT rules should also create a transparent and fair business environment between traditional business types and e-commerce and digital platform businesses.

Proposed VAT Rules for E-commerce and Digital Platforms

The proposed rules include the introduction of the deemed supplier rule for domestic and foreign e-commerce platform operators. This rule would make them liable for handling tax payments on behalf of the sellers using their platforms.

The draft regulation sets clear rules on when and how taxes should be deducted for e-commerce transactions. It states they must be deducted before the platform transfers payment from the buyer to the seller. The deducted amount is calculated as a percentage of the revenue from each completed transaction, with different rates depending on whether the transaction involves goods, services, or transportation.

The proposed applicable VAT rates for all domestic or foreign sellers are 1% for goods, 5% for services, and 3% for transportation or related services. If the platform cannot determine whether a transaction involves goods or services, it must apply the highest tax rate.

All e-commerce and digital platforms subject to new rules and regulations must report and pay the taxes deducted every month. Both domestic and foreign e-commerce platform operators receive a 10-digit tax code to handle tax returns and payments separately for each seller.

Conclusion

The consultations on proposed amendments to the VAT and other tax laws regarding new requirements for e-commerce and digital platforms are open to all interested parties to submit their comments and suggestions. This is the second proposed amendment to the VAT Law, and it remains to be seen what the final decision from the Vietnamese government will be on all proposed measures.

Source: Government Electronic Newspaper, VATabout

What are the proposed VAT rules for e-commerce and digital platforms in Vietnam?

The draft law introduces a deemed supplier rule, making e-commerce platform operators responsible for deducting and handling VAT payments on behalf of sellers.

How will VAT be deducted under Vietnam’s proposed e-commerce tax rules?

VAT must be deducted before the platform transfers payment from the buyer to the seller, with different rates applied based on whether the transaction involves goods, services, or transportation.

What are the proposed VAT rates for e-commerce transactions in Vietnam?

The proposed VAT rates are 1% for goods, 5% for services, and 3% for transportation or related services. If a platform cannot determine the transaction type, the highest rate applies.

Who must comply with the new VAT rules for e-commerce in Vietnam?

Both domestic and foreign e-commerce and digital platform operators must comply, obtain a 10-digit tax code, and report and pay taxes on behalf of sellers monthly.

How often must e-commerce platforms report and pay VAT under the new rules?

Platforms must file tax returns and pay the deducted VAT on a monthly basis to ensure compliance with Vietnam’s proposed tax regulations.

When will the new VAT rules for e-commerce and digital platforms take effect?

The regulations are still under consultation, and the final decision by the Vietnamese government on their implementation is yet to be determined.

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