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How to prevent tax losses from cross-border advertising

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According to the General Department of Taxation, there are 15 large corporations and technology companies in the world earning a lot of money from Vietnam through cross-border businesses.

If Vietnam’s online advertising revenue is about 1 billion USD, Google and Facebook account for more than 80%, or more than 800 million USD, according to Vietnam Digital Marketing Trends 2021 report.

Although they earn billions of US dollars in revenue from the Vietnamese market each year, the amount of tax Vietnam collects from these 15 corporations is modest, just over 1,000 billion VND (over $43.4 million) a year. In particular, this amount of money is not paid by these groups, but their contractors and agents.

“Statistics show that from 2018 to the end of October 2021, these groups declared and paid taxes a total amount of more than 4,263 billion VND, including more than 1,641 billion VND from Facebook; over 1,573 billion VND from Google; over 560 billion VND from Microsoft … In 2020, tax revenue from cross-border e-commerce activities reached over 1,143 billion VND,” said Ms. Nguyen Thi Lan Anh, from the Tax Administration Department of Small and medium-sized Enterprises, Business Households and Individuals of the General Department of Taxation.

In 2021, taxes collected from Vietnamese organizations that signed online advertising contracts with foreign organizations that do not have legal entities in Vietnam such as Google, Youtube, Facebook… was 1,314 billion VND, including 521 billion VND from Facebook, 490 billion VND from Google, and 164 billion VND from Microsoft.

Dr. Dinh Trong Thinh said the tax revenue is not commensurate with the revenue and potential of e-commerce. With a cross-border operating model, without a legal entity in Vietnam, it is very difficult to manage, monitor and collect information and data, making tax declaration, tax calculation and payment inaccurate. This is actually an act of tax evasion…

Mr. Nguyen Thanh Lam, Director of the Press Department (Ministry of Information and Communications), said that currently data on the behavior of information readers and shoppers are in the hands of cross-border technology platforms, so most of the advertising costs go to foreign technology companies.

Lam said that it is necessary to master technology so that user data is not controlled by foreign businesses, thereby regulating advertising resources on good and healthy content to serve users. In 2022, the Ministry of Information and Communications will continue to coordinate with relevant ministries and sectors to uniformly deploy economic and technical solutions to require cross-border social networks to comply with Vietnamese law on handling information violations, and paying taxes in Vietnam.

According to the General Department of Taxation (Ministry of Finance), in 2022, one of the key tasks of the tax sector is to uniformly implement solutions in tax management for e-commerce and digital platform-based businesses of foreign suppliers who do not have a business establishment in Vietnam.

“The Ministry of Finance has signed a cooperation agreement with the Ministry of Industry and Trade, including content about coordination in formulating and perfecting the law in the field of e-commerce. The two ministries will share databases and connect to exploit information to serve the state management of domestic e-commerce business,” said Ms. Lan Anh.

The General Department of Taxation also proposed that the Ministry of Finance develop cooperation programs and coordinate with the Ministry of Public Security and the State Bank of Vietnam on a mechanism to connect and share databases for tax administration.

Thanh Mai

Source: https://vietnamnet.vn/en/business/how-to-prevent-tax-losses-from-cross-border-advertising-820599.html

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CapitaLand Ascott’s gross profit in Vietnam up 31% to $10 mln in 2022

CapitaLand Ascott Trust, the management agency of five Somerset hotels in Vietnam, posted a revenue of S$27.6 ($20.63 million) from its Vietnam operation in 2022, up 33% year-on-year.

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Amid the country’s post-Covid-19 reopening, the revenue per available unit (REVPAU) grew 52% year-on-year to S$62 ($46.3) per day. The agency also attributed the growth to the acquisition of Somerset Central TD Haiphong City on November 30 last year.

As a result, the group earned a gross profit S$14 million ($10.46 million) in Vietnam, up 31% year-on-year.

On a global scale, CapitaLand Ascott recorded a revenue of S$621.2 million ($464.21 million) in 2022, up 58% year-on-year, with a REVPAU of S$120 ($89.67) per day, up 74%. Gross profit increased 63% year-on-year to S$282.8 million ($211.33 million).

CapitaLand Ascott Trust now manages five hotels in Vietnam, namely Somerset Hoa Binh Hanoi and Somerset Grand Hanoi in the capital city, Somerset Chancellor Court Ho Chi Minh City and Somerset Ho Chi Minh City in the southern economic hub, and Somerset Central TD Haiphong city.

The total valuation of the five hotels with 893 available units reached S$221.9 million ($165.82 million) as of end-2022, according to CapitaLand Ascott.

Source: The Investor

Source: https://e.nhipcaudautu.vn/companies/capitaland-ascotts-gross-profit-in-vietnam-up-31-to-10-mln-in-2022-3351413/

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Bamboo Airways has new investor

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Bamboo Airways is negotiating a deal with a new investor, showing its latest move one year after former chairman Trinh Van Quyet was arrested in March 2022 on charges of stock market manipulation, a representative of the airline told Tuoi Tre (Youth) newspaper on Thursday.

The air carrier and the new investor are in the process of completing a part of investment procedures. Who the investor is remains unclear.

The airline has found a new investor to replace former chairman Trinh Van Quyet and some relevant shareholders, said Bamboo Airways CEO Nguyen Manh Quan.

The air carrier also actively helped the investor with relevant procedures of stake acquisition. The transferred stake was mortgaged at banks from 2020 by old shareholders.

Apart from the stake purchase, the new investor agreed to take responsibility for all payments for the previous loans taken out by the old shareholders who used their stakes in Bamboo Airways as collateral at banks.

Over the past few months, Bamboo Airways has faced financial distress due to the COVID-19 pandemic and upheavals in senior personnel. As such, the airline has cried for help from major investors to relieve the hardship.

Him Lam Corporation lent Bamboo Airways VND8 trillion (US$338 million). Him Lam is a real estate firm run by Duong Cong Minh, who is a senior advisor to Bamboo Airways.

The airline’s recent moves are considered a solution to its restructuring and operation stabilization.

Speaking at its annual general shareholder meeting in early March, Le Ba Nguyen, chairman of FLC Group, said that the firm was considering selling its stake in Bamboo Airways.

FLC Group’s total investment in the air carrier stands at VND4.015 trillion ($170 million), or a 21.7-percent stake.

In 2021, Bamboo Airways missed earnings, so FLC made a provision for its investment of over VND373 billion ($15.7 million). The provision jumped to VND3.64 trillion ($154 million) in 2022.

A flight attendant is at work on a Bamboo Airways plane. Photo: Cong Trung/ Tuoi Tre

A flight attendant is at work on a Bamboo Airways plane. Photo: Cong Trung/ Tuoi Tre

Bamboo Airways has sought for a new investor for more than one year, as aviation is a highly competitive industry and is regarded as a ‘cash-burning industry’ in airspace.

The airline has a fleet of 30 planes. For its strong growth, the carrier is set to expand its fleet to 100 aircraft.

Other local airlines, Pacific Airlines and Vietravel Airlines, are also looking for investors to make their financial health better to overcome market challenges.

FLC Group set up Bamboo Airways in late May 2017, with its initial charter capital of VND700 billion ($29.6 million).

In April 2022, FLC became the airline’s largest shareholder, with capital contribution totaling over VND3.58 trillion ($151.4 million), or a 51.24-percent stake in the air carrier.

FLC former chairman Quyet poured over VND2.8 trillion ($118.4 million) into the airline, or a 40.03-percent stake, while other shareholders injected more than VND610 billion ($25.8 million), an 8.73-percent share.

In its recent financial statement, FLC’s ownership in Bamboo Airways fell to 21.7 percent of the latter’s total charter capital of VND18.5 trillion ($782.3 million).

Bamboo Airways’ board of directors has five members, including Nguyen Ngoc Trong, chairman of the airline; Doan Huu Doan and Le Ba Nguyen, vice-chairs of the carrier; Le Thai Sam; and Nguyen Manh Quan.

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Bamboo Airways is negotiating a deal with a new investor, showing its latest move one year after former chairman Trinh Van Quyet was arrested in March 2022 on charges of stock market manipulation, a representative of the airline told Tuoi Tre (Youth) newspaper on Thursday.

The air carrier and the new investor are in the process of completing a part of investment procedures. Who the investor is remains unclear.

The airline has found a new investor to replace former chairman Trinh Van Quyet and some relevant shareholders, said Bamboo Airways CEO Nguyen Manh Quan.

The air carrier also actively helped the investor with relevant procedures of stake acquisition. The transferred stake was mortgaged at banks from 2020 by old shareholders.

Apart from the stake purchase, the new investor agreed to take responsibility for all payments for the previous loans taken out by the old shareholders who used their stakes in Bamboo Airways as collateral at banks.

Over the past few months, Bamboo Airways has faced financial distress due to the COVID-19 pandemic and upheavals in senior personnel. As such, the airline has cried for help from major investors to relieve the hardship.

Him Lam Corporation lent Bamboo Airways VND8 trillion (US$338 million). Him Lam is a real estate firm run by Duong Cong Minh, who is a senior advisor to Bamboo Airways.

The airline’s recent moves are considered a solution to its restructuring and operation stabilization.

Speaking at its annual general shareholder meeting in early March, Le Ba Nguyen, chairman of FLC Group, said that the firm was considering selling its stake in Bamboo Airways.

FLC Group’s total investment in the air carrier stands at VND4.015 trillion ($170 million), or a 21.7-percent stake.

In 2021, Bamboo Airways missed earnings, so FLC made a provision for its investment of over VND373 billion ($15.7 million). The provision jumped to VND3.64 trillion ($154 million) in 2022.

A flight attendant is at work on a Bamboo Airways plane. Photo: Cong Trung/ Tuoi Tre

A flight attendant is at work on a Bamboo Airways plane. Photo: Cong Trung/ Tuoi Tre

Bamboo Airways has sought for a new investor for more than one year, as aviation is a highly competitive industry and is regarded as a ‘cash-burning industry’ in airspace.

The airline has a fleet of 30 planes. For its strong growth, the carrier is set to expand its fleet to 100 aircraft.

Other local airlines, Pacific Airlines and Vietravel Airlines, are also looking for investors to make their financial health better to overcome market challenges.

FLC Group set up Bamboo Airways in late May 2017, with its initial charter capital of VND700 billion ($29.6 million).

In April 2022, FLC became the airline’s largest shareholder, with capital contribution totaling over VND3.58 trillion ($151.4 million), or a 51.24-percent stake in the air carrier.

FLC former chairman Quyet poured over VND2.8 trillion ($118.4 million) into the airline, or a 40.03-percent stake, while other shareholders injected more than VND610 billion ($25.8 million), an 8.73-percent share.

In its recent financial statement, FLC’s ownership in Bamboo Airways fell to 21.7 percent of the latter’s total charter capital of VND18.5 trillion ($782.3 million).

Bamboo Airways’ board of directors has five members, including Nguyen Ngoc Trong, chairman of the airline; Doan Huu Doan and Le Ba Nguyen, vice-chairs of the carrier; Le Thai Sam; and Nguyen Manh Quan.

Like us on Facebook or follow us on Twitter to get the latest news about Vietnam!

Source: https://tuoitrenews.vn/news/business/20230318/bamboo-airways-has-new-investor/72149.html

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Eximbank forecasts $212 mln profit in 2023

Eximbank is aiming for a pre-tax profit of VND5 trillion ($212 million) in 2023, up 35% year-on-year, according to a document to be released at its 2023 annual shareholders meeting.

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The meeting is scheduled to be held on April 14 at the GEM Center Convention Center, Ho Chi Minh City. 

In 2023, Eximbank targets total assets of VND210 trillion ($8.9 billion), up 13.5% year-on-year. Capital mobilization is expected to increase by 11% to VND165 trillion ($7 billion), and outstanding loans (including corporate bonds) to increase by 12.3% to VND146.6 trillion ($6.22 billion).

At the meeting, Eximbank will also present to shareholders a plan to increase charter capital. Specifically, the bank plans to issue 265.5 million shares to pay dividends, increasing its charter capital to more than VND17.47 trillion ($740.77 million).

Eximbank, listed on the Ho Chi Minh Stock Exchange (HoSE) as EIB, reported an after-tax profit of VND2.5 trillion ($106.78 million) in 2022, a three-time increase year-on-year.

The bank’s net interest income reached VND5.59 trillion ($238.47 million), up 59% year-on-year, while profit from service activities hit VND514 billion ($21.92 million), up 19%.

Profit from foreign exchange business increased by 54% to VND606 billion ($25.84 million), and the figure from other activities, mainly debt collection and settlement, rose by 68% to VND428 billion ($18.25 million).

Eximbank’s total operating income was VND7.23 trillion ($308.45 million), up 53.6% year-on-year. Operating expenses increased by 36% to VND3.42 trillion ($145.84 million), meaning the cost to income ratio (CIR) improved significantly, down from 53% to 47%.

Notably, the bank’s risk provision expense in 2022 was only VND103 billion ($4.39 million), down 90% over the same period last year.

By December 31, 2022, Eximbank’s total assets had reached VND185.05 trillion ($7.89 billion), up 11.6% compared to the end of 2021.

Outstanding loans increased by 14% to VND129.2 trillion ($5.51 billion), and customer deposits increased by 8.2 % to VND148.61 trillion ($6.34 billion).

Eximbank’s bad debt was VND2.35 trillion ($100 million), up 4.4% year-on-year, an increase much lower than the credit growth rate. The bad debt ratio improved, decreasing from 1.96% to 1.8%.

On January 14, Japan’s Sumitomo Mitsui Banking Corporation (SMBC) sold 134 million Eximbank (EIB) shares, equivalent to 10.8% of the bank’s charter capital, for VND3.421 trillion ($146 million). 

On March 18, 2022, the Japanese financial institution officially announced in writing the termination of its strategic alliance agreement with Eximbank. In September, a representative of SMBC in Eximbank, Vo Quang Hien, left as a member of its board of directors.

On the HoSE, Eximbank closed Monday’s session at VND18,750 ($0.79).

Source: The Investor

Source: https://e.nhipcaudautu.vn/companies/eximbank-forecasts-212-mln-profit-in-2023-3351414/

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