Vietnam unveils tools for taxing and tracking Big Tech

HO CHI MINH CITY -- Vietnam is proposing a pair of regulations that would compel global tech players such as Alibaba and Google to hand over more taxes and data, in a move to increase government oversight in one of the world's fastest-growing digital markets.

One proposal would give state inspectors access to an e-commerce site's internal data on merchants, while the second would introduce a tax collection regime deemed "onerous" and "concerning" by a trade group funded by the likes of Apple and Japanese e-commerce giant Rakuten.

While Hanoi has been trying to regulate Big Tech for years -- especially those harder to reach companies based overseas -- the two latest proposals specify the tools it would use.

In the case of taxes, Vietnamese officials plan to go where the money is: banks.

The pending regulation, known as a circular, would require banks in the country to sift through clients' accounts and withhold taxes on any payments made to foreign companies for e-commerce and digital services. If a Vietnamese consumer buys a Netflix subscription, for example, her bank would deduct a portion for tax and pass on the rest to the U.S. streaming company.

To avoid having payments docked in this manner, businesses outside Vietnam will be able to register with the government through a web portal that is expected to come online later this year and file taxes themselves.

Business groups, however, have voiced concern about the proposed measure.

"Certain provisions in the draft circular are concerning and overly complex, which will likely result in onerous and unnecessary burdens throughout the value chain, including on Vietnamese customers," said Jeff Paine, managing director of the Asia Internet Coalition, whose members include Airbnb, Yahoo and Line, the Japanese chat app operator.

Netflix told Nikkei Asia that talks with Vietnamese officials over the issue are "ongoing."