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​Making fortune from Internet not uncommon thing in Vietnam

Wednesday, October 17, 2018, 13:02 GMT+7

More and more Vietnamese coming from a variety of backgrounds are becoming self-made dollar millionares thanks to Internet-based platforms such as YouTube, Google and Facebook.

From app developers to artists and businesses, people have realized that these channels are fertile ground for monetizing, mostly via online ads.

Whopping income

Vietnamese comedian Thu Trang, the owner of Thu Trang Channel, one of the two comedic channels listed among the top 20 YouTube personalities in the Southeast Asian country, has been a YouTube content creator since 2010.

In the beginning, Trang merely launched her channel under the desire to give opportunity to those who could not go to the theater to watch her plays.

But when the content became more popular, the comedian also received revenue from ads displayed in her YouTube videos, being stunned to see she could make money from online products.

The normal revenue-sharing ratio between an individual content creator and YouTube is 68:32, which means that the channel owner will receive 68 percent of the advertising revenue, according to data reviewed by Tuoi Tre (Youth) newspaper.

For corporate partners, the ratio is raised to 70:30, and even up to 90:10 for larger channels.

In Trang’s case, she works with YouTube through her own company.

Since Vietnam is still a small market, the turnover rate is only US$0.5-1 per 1,000 views, meaning that with one million views, the content creator will receive $1,000 at most.

Leading the top 20 Vietnamese singers with the most subscribers on YouTube is Son Tung M-TP, who now has more than 3.3 million followers on his verified channel.

The 1994-born pop star can therefore pocket about $4,000-40,000 per month from his YouTube channel.

Similarly, female singer Tien Cookie rakes in some $2,000-32,000 per month thanks to her YouTube follower base of 628,000, according to estimates of experts.

Even actress-turned-singer Chi Pu, whose singing ability sparks controversy, also earned between $5,000 and $10,000 a month, having nearly 570,000 people regularly watching her channel.

However, views from outside Vietnam will bring in bigger revenues for the content creators.

YouTube pays a Vietnamese content creator $6-8 for every 1,000 views generated from overseas markets, especially North America and Europe. One million views translate into more than $5,000.

That is why channel owners in Vietnam exert effort on creating content that attracts viewers from outside the country to enjoy bigger revenue shares.

The Vietnamese YouTube channels currently do not only feature comedy videos as they used to do in the past, but cover a wider variety of content types, from children's education and entertainment to news and topical events.

Notably, the top 20 most-viewed YouTube channels in Vietnam are those with contents dedicated to kids.

Topping this list is POPS Kids with over 6.1 billion views, followed by KN Channel and Super Kids, with two million and 1.5 million views, respectively.

Tax declaration

According to the Ho Chi Minh City tax department, many local artists have opened their own companies to be their legal entities, while others work for entertainment firms.

In the former case, the artists get paid by their companies and consequently do not have to declare personal income tax as required if they work individually.

As business owners, the celebs are only required to pay a corporate income tax of 20 percent, whereas personal income tax has a seven-tier range from five percent to 35 percent.

Comedian Thu Trang, for instance, has her company receiving payments from YouTube instead of herself, therefore only having to pay corporate income tax for this source of income.

With many Vietnamese making a fortune from the Internet, tax authorities have been encouraging people to declare tax for this source of income, according to Nguyen Nam Binh, deputy head of the Ho Chi Minh City taxman.

However, after reviewing four major banks in Ho Chi Minh City, the municipal taxman was able to make a list of thousands of individuals, who received income from Google, Facebook and YouTube, but ignored tax declaration.

The amount of money that these Internet platforms paid these individuals amounted up to over VND500 billion ($21.6 million).

A number of local organizations have also received several thousand billion dong from Internet giants through these same four banks.

In the coming time, these individuals and organizations will be summoned by the city’s tax watchdog.

Binh also warned that individuals and businesses should understand tax authorities always have a way to oversee the incomes of taxpayers, even if they come from foreign organizations.

The tax deputy head mentioned the case of a man in Ho Chi Minh City, who has been required to pay more than VND4.1 billion ($176,000) in personal income tax arrears for ad revenues he collected in two years from online platforms, as an example.

The 20-year-old app developer, whose name is not disclosed by tax authorities, reportedly received over VND41 billion ($1.76 million) from Google, Facebook and YouTube between 2016 and 2017 thanks to in-app ads the companies placed in the mobile games he developed.

According to the municipal taxman, the app developer and his team appeared surprised when they were summoned and asked to pay the tax arrears.

Therefore, to avoid penalties for late payment, Binh advised that individuals, who have yet to declare tax for income earned from Internet giants such as Google, Facebook and YouTube, go to tax departments to be guided on the declaration procedure.

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Bao Anh / Tuoi Tre News

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