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Gasoline prices fall for first time in 2021



A car is refilled at a gas station. Domestic fuel retail prices have been revised down for the first time in 2021 – PHOTO: VNA

HCMC – The retail prices of gasoline have been revised down for the first time this year, according to an announcement jointly issued by the Ministries of Industry-Trade and Finance.

From 4:30 p.m. today, April 12, the bio-fuel E5 RON92 price dropped by VND45 per liter to VND17,806, while RON95 petrol is now priced at VND18,970 per liter, down VND76.

The retail prices of diesel oil and kerosene also fell VND102 per liter to VND14,141 and VND177 per liter to VND12,827, respectively, and that of heavy fuel oil dropped VND70 per kilogram to VND13,687.

During this fuel price adjustment, the two ministries decided not to extract money for any fuels to replenish the national fuel price stabilization fund.

Meanwhile, local fuel traders were allowed to tap the fund at VND1,800 for each liter of E5 bio-fuel sold to customers, VND950 for each liter of RON95 petrol, VND250 for each liter of diesel oil, VND300 for each liter of kerosene and VND500 for each kilogram of heavy fuel oil.



Central city calls for ICT investment from South Korea




A forum on ICT investment promotion from South Korea introduces investment opportunities in Đà Nẵng. — Photo courtesy of Đà Nẵng Investment Promotion Centre

ĐÀ NẴNG — South Korea will be one of the most important potential strategic partners in Đà Nẵng’s investment promotion and digital transformation plan for 2025-30, particularly in information and communication technology (ICT).

Deputy Chairman of the city’s People’s Committee Trần Phước Sơn urged for more investment from South Korea in Đà Nẵng to boost the ‘smart city, hi-tech innovation hub’ master plan, during the South Korea ICT Investment promotion to Đà Nẵng forum on Tuesday.

Sơn said South Korea had been listed as a top five-investor in Đà Nẵng, with 233 projects worth US$378 million, hosting 214 direct and chartered flights (before the COVID-19 pandemic) and carrying 1.5 million tourists to the central city (50 per cent international visitors) per week.

Two engineers inspect a production line at the surface-mount technology factory in Đà Nẵng IT Park. — Photo Quang Huy 

He said the city’s ICT, which earned US$1.3 billion in 2020, aimed to increase revenue to $2.34 billion, contributing 15 per cent of city’s Gross Regional Domestic Product in 2030.

The deputy chairman said Đà Nẵng had made ICT infrastructure available to Korean investors flocking in after COVID-19 was under control.

The South Korea consulate general in Đà Nẵng Ahn Min Sik said two-way trade between Việt Nam and Korea had increased from $500 million in 1992 to $69 billion in 2020.

The two sides have eyed expansion in IT and the fourth Industrial Revolution in celebration of the 30th anniversary of diplomatic ties between Việt Nam and Korea next year, he said.

Ahn Min Sik said Đà Nẵng had been developing IT infrastructure and was an increasing investment attraction of FDI, including from Korea.

“LG Electronics set up its research and development centre – the second in Việt Nam – in Đà Nẵng, promising further co-operation in ICT between Korea and Đà Nẵng,” he said.

An urban zone of Đà Nẵng Information Technology Park offers living conditions for investors and their families. — Photo courtesy of Quang Huy 

“Korea helped the city build the Việt Nam-Korea Friendship Information Technology College with Official Development Aid funding of $10 million from South Korea from 2007, and upgraded it to a university specialising in training IT human resources for 2020-25,” he added.

He also said Korea had helped support smart city projects in Đà Nẵng, and Quảng Nam and Thừa Thiên-Huế provinces, as well as climate change projects.

Kim Jinmo, deputy director of the South Korea Trade and Investment Agency Đà Nẵng Office, said that investment flow from Korea to Việt Nam would focus on manufacturing and production, real estate, electronics and ICT.

He said electronics investors (including two key investors Samsung and LG) accounted for 23 per cent of funds from South Korea, with annual an 3.7 per cent growth.

Lee Byoung Moog, deputy director of Korean IT co-operation centre, said investment between Việt Nam and Korea had been boosted in the last five years in line with completed free trade agreements, and IT was seen as having the most growth.

He said Samsung with 200 partners, and LG with 100 partners, had helped promote technological solutions, financial services and Fintech.

Lee said other IT investors including Naver AI centre, SK Group, OK Xe and Baemin had also been working in Việt Nam.

He said Đà Nẵng planned to build an international financial centre, and the city should eye FinTech development for future investment flow.

Deputy Director of Đà Nẵng Information and Communications Department Lê Sơn Phong said the city had designed an IT and Innovation Zone including an IT Park, a Hi-tech Park and a Creative Space for potential investors.

Phong said the IT Park, which was built on 131 hectares costing $47 million, was ready for working and living in a combined urban zone in the northwest region.

An exhibition of a ‘smart city’ project in Đà Nẵng. The central city plans to become a smart city by 2030. — Photo Công Thành 

Last year, representatives of 30 Korean firms paid a field visit to seek investment opportunities at a new operated surface-mount technology factory in Đà Nẵng Hi-tech Park.

Investors would get special preferential mechanisms from the park with free land rental from five to 50 years depending on investment scale, and preferential corporate income tax for 15 years, as well as exemption from import tax on production material and information technology service as well as export tax.

Đà Nẵng IT park – the third national IT centralised zone – expects to create revenue of $1.5 billion each year, with 25,000 jobs and a satellite city of 100,000 people.

A report from the Ministry of Information and Communications has included Đà Nẵng in the top 10 provinces and cities with ICT revenue of more than $1 billion in Việt Nam.

In 2020, the Consulate General of the Republic of Korea was opened in Đà Nẵng, boosting investment and trade between Korea and central Việt Nam.

The South Korea Trade and Investment Agency also opened its office in Đà Nẵng to promote investment and connection among Korean investors.

The leading Korean hospitality corporation, Shilla Hotels & Resorts, debuted with the Shilla Monogram Quảng Nam-Đà Nẵng resort on the beach of Quảng Nam and Đà Nẵng City, marking its first footprint outside of South Korea, with total investment of $50 million. —


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A pivotal time to capture tourism property potential



Vietnam should complete a sturdy legal framework in order to allow non-nationals to buy tourist property in the country, according to international experts.

A pivotal time to capture tourism property potential
Tourism real estate wants to bounce back after experiencing 18 months of hardship. VIR Photo Le Toan

Talking with VIR, Dr. Sopon Pornchokchai, president of the International Real Estate Association in Thailand and Thai Appraisal & Estate Agents Foundation, noted that foreigners remain extremely interested in owning apartments in the likes of Hanoi and Ho Chi Minh City.

“There appears to be an opportunity to initiate urban resorts for foreigners. Major chains of world-class hotels and resort properties can participate in plots of land planned and provided by the central government or local governments as well,” Pornchokchai said. “In Thailand, this issue is an open policy with minor restrictions. This is because when foreigners own tourism real estate, it brings about many other benefits in terms of tourist flow and cash. So this is not a disadvantage.”

Moreover, he suggested the government allow investors to lease properties, particularly in the case of apartments.

“For affluent senior citizens, a lease could be up to 30 years, which is an ample period of time for them. For others, it could be up to 50 years. In addition, Vietnam should have an annual property tax, capital gain tax, and estate tax at a similar rate that appears in western countries,” he said.

But creating a complete legal framework to cover all activities in tourism property is a pressing issue, which the Ministry of Construction (MoC) is looking into (see opposite). Thailand has many laws and policies that govern the operation of the tourist real estate market, but these legal regulations are deemed clear and specific, according to Pornchokchai. “Based on those, it is easy for the government to manage and investors are also comfortable in the implementation and deployment process,” he said. 

Strict evaluation

Mark M. Kitabayshi, global coordinator for Asia-Pacific at the US National Association of Realtors, said that based on experience in the US, there is an apparent division of real estate development areas, including tourism real estate.

In terms of tax policy, the US attracts investment by exempting and reducing taxes. Currently, while only foreign resident financiers have to pay foreign investment tax, only US residents are subject to capital gains tax, so it evens out, Kitabayshi says. “Other taxes, like property tax, are set by each state but it is the same for nationals and foreigners. So this does not make it challenging for overseas investors to make a purchase,” he added.

Lessons from the US prove that for Vietnam to determine the place and type of investment, the nation must evaluate where tourists come from, for what purpose, and for how long. Other factors are the relationship with current real estate-related regulations such as zoning and related funding regulations.

In recent years, before the pandemic strangled the industry, the tourism real estate segment has developed actively with many high-end products such as condotels, shophouses, resorts, homestays, and farmstays in Vietnam. However, policies and laws on tourism real estate are still incomplete and inconsistent, causing confusion for state management of the market in localities and causing a bottleneck for business activities.

According to Nguyen Manh Khoi, deputy director of the Department of Housing Management and Real Estate Market under the Ministry of Construction, tourism property is currently overseen by many different regulations and laws. The current laws on land and real estate mention tourism property including condotels, resort villas, and farmstays as “commercial and services construction”. This means that tourism properties are built on tourism and service land plots, which is why they are not given long-term ownership.

“This misleading situation causes confusion for tourism property developers, buyers, and local authorities, leading to a dispute in their business,” Khoi explained. 

Long-term cracks

Meanwhile Doan Van Binh, vice chairman of the Vietnam Real Estate Association, admitted that tourism property faces major problems.

“The laws on investment and tourism real estate business still have many significant gaps, such as complicated investment procedures that waste time and cost for developers,” Binh said. “There are no regulations or policies to attract foreign investment in tourism real estate. However, the current land law allows foreigners to buy houses – but not for tourist real estate.”

Moreover, Vietnam has no legal regulations to control ambiguity in profit commitment, capital mobilisation, and sharing profit in timeshare properties.

Tourism real estate was once dubbed a “golden egg” for Vietnam some years ago. According to the Vietnam Association of Realtors, more than 18,000 condotels were launched for sale in 2020. However, liquidation was very low and the pandemic has since continued to wipe out the resilience of the condotel market.

According to Nguyen Hoang, director for research and development at DKRA Vietnam, the condotel segment was creaking before the pandemic hit.

“From 2016 to 2018 this segment had enormous supply, with tens of thousands of apartments put into the market every year,” Hoang said. “However, after this, some project developers could not pay the rental yield as committed, upsetting owners and causing conflicts to break out.”

Predicting the development of condotels in the near future in Vietnam, Hoang said that with tourism activities still severely reduced, major obstacles will persist until socioeconomic activities are fully resumed.

Source: VIR


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Boosting e-commerce tax collection



Experts say that the tax potential of enterprises operating across borders is quite large.— Photo

HÀ NỘI — Tax revenue from cross-border e-commerce activities reached more than VNĐ1 trillion (US$43.5 million) in the first nine months of this year.

The General Department of Taxation said about 14 large corporations and technology companies in the world and eight cross-border e-commerce websites operating with income in Việt Nam fulfilled their tax obligations through Vietnamese organisations and individuals.

Tax revenue from Vietnamese organisations that have signed online advertising contracts with foreign organisations that have not established legal entities in Việt Nam such as Google, Youtube or Facebook was estimated at VNĐ4.1 trillion from 2018 to the end of September this year.

Of which, Facebook paid VNĐ1.56 trillion; Google VNĐ1.53 trillion; and Microsoft VNĐ533 billion.

Tax revenue from cross-border e-commerce activities reached about VNĐ1.14 trillion last year. That of the first nine months of this year reached about VNĐ1.01 trillion, equaling 88.95 per cent of last year.

The General Department of Taxation has issued many documents to guide foreign suppliers providing cross-border services. Of these, Netflix has declared and paid taxes in accordance with Vietnamese tax law.

The General Department of Taxation is continuing to issue documents to request these companies to fulfil their tax declarations and payment obligations in accordance with Vietnamese law.

Tax authorities will co-ordinate with relevant State management agencies, commercial banks and tax authorities of other countries to implement tax management measures for overseas suppliers.

In the past two years, amid the COVID-19 pandemic, forms of online commerce, advertising, and shopping experienced strong growth.

Experts in the financial and economic fields said that during the pandemic, while most economic sectors were negatively affected, the digital economy and e-commerce are some of the few industries to see growth, even impressive growth.

Experts say that the tax potential of enterprises operating across borders is quite large.

It is necessary to continue to strengthen the review of non-resident e-commerce transactions in Việt Nam, thereby building a tax management mechanism in accordance with international practices, combating the loss of tax revenue from cross-border transactions.

In particular, experts also recommended continuing to research, develop and issue sanctions to prevent taxpayers from evading tax obligations. It is also a must to ensure effective and tight management of tax sources arising in the field of e-commerce. —


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