Helpless or indifferent to the Temu phenomenon?

Many people, not only online business organizations and individuals but also many people have heard the name Temu.

Appearing on the Vietnamese regional app store of iOS and Android since the end of September 2024, continuously for many weeks, the "floor" Temu has made a stir in the Vietnamese market with a rich variety of goods, super cheap prices plus unexpected promotional policies, sometimes up to 94% of the order value, along with a free shipping policy.

The problem is that this e-commerce platform has been operating illegally to penetrate the market. Many days after "Typhoon Temu" made landfall, the Ministry of Industry and Trade assigned the Department of E-commerce and Digital Economy to request this platform to comply with the law.

Not only Temu, recently other cross-border e-commerce platforms such as Shein, 1688 have also been operating in Vietnam but have not registered. Do the management units know about that appearance?

In Hai Duong, if in 2023, the whole province had only 50 individuals doing e-commerce business declaring and paying a total of 2.7 billion VND in taxes, then in July 2024 alone, this number was 263 individuals declaring and paying a total of 2.466 billion VND in taxes. Accumulated from the beginning of the year to the end of July 2024, in the province, there were 413 individuals doing e-commerce business declaring and paying taxes, with a total tax of 17.785 billion VND, nearly 7 times higher than the previous year.

However, the results of tax collection and arrears of organizations and individuals doing business on e-commerce platforms or selling online in Hai Duong are mainly through the process of checking, reviewing and synthesizing from organizations and individuals operating in the field of e-commerce of the tax sector connected nationwide.

These outputs from the General Department of Taxation are transferred to the Provincial Tax Department, then transferred to the affiliated branches to carry out the tax collection process. Therefore, it is often delayed by 6 months to 1 year, or even longer than the time when e-commerce activities generate tax. Tax losses from this field are therefore difficult to avoid.

Only a few tens of millions of dong in administrative fines for unregistered e-commerce websites compared to revenues that can be many times higher, is that enough of a deterrent? Not to mention that there are organizations and individuals who sell online on social networking sites in many forms such as leaving comments in certain groups, or trying to hide their revenues.

At this time, unhealthy competition is not only between traditional and online business forms, or within the online sector, but also escalates into competition between businesses that contribute to the state budget and businesses that show signs of tax evasion. How do we protect honest business people? How do we inspect and punish the remaining group?

Looking from Temu, this platform provides a huge amount of goods, from household goods, fashion to accessories of all kinds. Prices are sometimes only a few tens of thousands of dong. With Temu, instead of buying goods from a big brand on the market, consumers can buy that product from the manufacturer for the big brand at a much lower cost.

In particular, Vietnam has a policy of exempting value-added tax on goods under 1 million VND imported through e-commerce platforms. This regulation has been fully exploited, resulting in a large amount of cheap goods flooding the domestic market.

Explaining to the National Assembly on October 29, Deputy Prime Minister and Minister of Finance Ho Duc Phoc said the Government will abolish the regulation on exemption of value-added tax for goods under 1 million VND imported through e-commerce platforms.

It can be considered as solving one problem. However, there are still problems in management, creating a fair and transparent business environment in the online environment.