Vietnamese individual fined for evading tax on $1.75mn worth of Facebook, Google ads
Wednesday, August 01, 2018, 19:02 GMT+7
The Ho Chi Minh City Department of Taxation has imposed a fine worth VND4.1 billion (US$175,467) upon an individual for failing to pay taxes after earning over VND41 billion ($1.75 million) from Facebook and Google advertisements in two years.
This is the first-ever case in which a Vietnamese resident has been penalized for failing to declare income sourced from foreign countries and pay corresponding taxes, said Nguyen Nam Binh, deputy head of the municipal taxman.
This individual developed an online game which was downloaded by many people, Binh said.
Facebook, Google, and YouTube then signed deals to run ads in his game and paid him more than VND41 billion in 2016 and 2017, he elaborated.
The Ho Chi Minh City resident, however, did not declare his earnings to authorities as required by law and thus did not pay his taxes.
During a recent working session, the violator claimed he had “forgotten” to declare his income paid by the global tech giants.
The tax department then decided to fine him VND4.1 billion, including the taxes that he should have paid as well as a penalty for late payment.
The agency is also trying to summon another individual who did not pay his duties after earning up to VND30 billion ($1.28 million) from the same firms.
Officials believed that the number of tax evaders similar to the two individuals is much higher.
A brief inspection of four local banks showed that Google and Facebook had wired more than VND500 billion ($21.4 million) to multiple accounts at these lenders.
As per regulations, residents have to pay a seven percent tax if they receive over VND100 million ($4,280) per year from such organizations as Google and Facebook.
Further examinations will be conducted at other banks to discover potential tax evaders, Binh said.
“We hope this move will create fairness and transparency when it comes to enforcing tax regulations, especially on those who earn money in non-traditional methods such as developing apps, games, or making viral videos,” the official said.
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