Social media moneymakers caught evading tax

By Le Chi   August 2, 2018 | 10:54 am GMT+7

Authorities say many individuals and organizations have not been paying taxes on high income made online.

An inspection carried out by tax authorities has found many citizens paying a lot of money to Facebook, Google and Youtube to take advantage of their services, and also earn significant income, with these sites paying several users significant sums.

After studying records at just four commercial banks, the tax inspectors found more than VND500 billion ($21 million) had been sent to the bank accounts of many individuals, groups, and organizations, with payments ranging from a few hundred to several thousand dollars at a time.

Nguyen Nam Binh, Deputy Director of the Ho Chi Minh City Tax Department, cited the example of an unnamed individual who was fined $175,000 for tax evasion. This person had received a total of $1.75 million in payments from 2016 to 2017 for writing code for an online game which lots of people downloaded from Facebook, Google, Youtube and other sites.

This was highest tax evasion spotted by an individual with income from overseas, Binh noted.

"The $175,000 fine included $128,000 in back taxes, late fees and fines," Binh said.

Another example that Binh cited was that of a Quang Nam native living in Saigon, who also received more than $855,000 from those social media sites did not file tax. When authorities summoned this person during their investigation, they found that he was no longer residing at his Saigon address. Binh did not specify the time period in which the money was earned.

Binh said he wanted to use this opportunity to advise everyone who has failed to pay taxes on their online income to contact the tax department and pay their dues.

Ho Chi Minh City taxmen said money earned from organizations like Facebook, Google and YouTube was private business income.

Under current laws, a business must pay tax when it earns VND100 million ($4,200) a year or more. The minimum tax rate is seven percent on gross income, including five percent VAT and two percent personal income tax.

 
 
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