Online game services are subject to special consumption tax
- 184
- Business
- 01:27 17/03/2023
DNHN - All ages of the population are attracted to the current type of game business, which generates high revenue and profit relative to other business types.
The Ministry of Finance has proposed drafting a revised version of the Special Consumption Tax Law. Consequently, a special consumption tax applies to online gaming services.
The Special Consumption Tax Law (TTDB) No. 27/2008/QH12 went into effect on April 1, 2009, replacing the Special Consumption Tax Law of 1999 and the Law on Amending several Articles of the Consumption Tax Law. Particularly in 2003, the Law amen-amended supplementing several articles of the Law on Special Consumption Tax, and the Value-Added Tax Law in 2005. In 2018, the 2008 Law on Special Consumption Tax has been amended and supplemented four times. 2014, 2016, and 2022 to address inadequacies that arise in practice and dance with each period's tax management requirements.
The implementation of the excise tax policy has revealed nuseveraliciencies and limitations that must be addressed. The current SCT Law must expand the scope of items subject to Mexican se tax to include items with consumption restrictions or production orientation. In addition, the application process is hindered by the obscurity of some current regulations governing taxable objects and tariff schedule items.
According to statistics from the Department of Broadcasting, Television, and Electronic Information, the game industry in Vietnam will be thriving by the end of 2022, with 50 percent of the most popular mobile games coming from Vietnam, five of the top ten game studios in Asia-Pacific and Australia, and one in every twenty-five games downloaded from app stores.
"Vietnam's gaming revenue reached $365 million in 2018, $665 million in 2021, and is projected to be positive in 2022. However, the amount of tax paid to the State accounts for only fifty percent of the total; the remaining fifty percent is paid by individuals. Mr. Le Quang Tu Do, Director of Broadcasting, Television, and Electronic Information, stated at the "Conference to Expand Vietnam Game Industry Market: Reaching Out to the World" on December 10, 2022, that this paradox requires immediate investigation and resolution by the relevant agencies so as not to continue losing tax revenue.
Another advantage of the online gaming market is that it is not restricted geographically. Businesses in Vietnam can produce and sell to the entire world, generating millions of dollars. This is the strength of Vietnam, a country with a small market where making domestic games alone would not generate sufficient revenue to cover expenses. Or at the 31st SEA Games, eSports (Esports) is recognized as a medal-awarding sport.
At the 31st Southeast Asian (SEA) Games, held in Vietnam, there are eight e-sports disciplines with ten competitions and ten sets of medals. Participating nations can sign up to take part in the entire event. With four gold medals and three silver medals, Vietnam topped the group.
If tax is collected, the online game industry will significantly contribute to the State budget if Vietnam's potential and advantages are realized, as demonstrated by the data presented above.
In the report summarizing and evaluating the implementation of the Law on Special Consumption Tax (Special Consumption Tax), the Ministry of Finance stated clearly: Online video games (online games) are a type of entertainment associated with the development of the internet, there is the interaction between players and between players and servers of businesses providing online game services through electronic devices such as personal computers, game consoles, mobile phones, and tablets.
The Ministry of Finance has determined, based on the implementation of the SCT Law and the summary report, that the current game business type generates a substantial amount of revenue and profit compared to other business types. To direct consumption, the government must investigate and add this type of business to the scope of excise tax.
The Law on SCT must be amended and supplemented to further institutionalize the views, guidelines, and policies of the Party and State...; to be consistent with the goal of excise tax reform, building a synchronous tax system; to overcome the obstacles and limitations of the current excise tax policy; and to be compatible with the global context of economic integration and development trends.
This number is expected to rise to 4.5 billion by 2030, from the current 3 billion. The gaming industry is nearly $200 billion with double-digit annual growth.
The situation of the game industry will continue to be influenced by the macro economy until the end of 2023. Experts forecast that this industry will flourish once more in 2024, with global revenue possibly reaching nearly USD 190 billion.
Phuong Anh (t/h)
Related news
- Long An - Jeju Cooperation: Enhancing Local Friendship Ties
- Ministry of Finance: Corporate bond maturity volume in 2024 will decrease compared to last year
- Long An continues to push for Korean investment - Promoting comprehensive development collaboration
- Sunwah Group signed strategic partnership with Binh Duong province, Emphasising the strategic cooperative partnership between China and Vietnam
- National Assembly Chairman Vuong Dinh Hue received and worked with the Chairman of Sunwah Group (Hong Kong-China)
- Dr Vu Tien Loc: Unlocking the real estate market to boost the economy is a crucial solution
- Ba Ria - Vung Tau: 4 key areas of industry, seaports, tourism and high-quality services planned to attract investment
- Financial solutions for the global supply chain in Vietnam
- Viettel ranks second in global telecoms brand index
- Vietnam’s steel imports are estimated to exceed US$4 billion by the end of the first quarter of 2024
- Acting President Vo Thi Anh Xuan meets a delegation of the Vietnam Young Entrepreneurs Association
- State-owned enterprises to play a leading role in the economy
- Ensuring power supply - a key factor for FDI enterprises to invest in Vietnam
- South Korea to approve projects supporting Vietnam’s agricultural development
- Thanh Hoa Business Association: Seminar and Business Networking in Trieu Son District
- Binh Thanh Business Association organised March’s “Business Start-up and Management” Coffee Talk
- Vietnamese businesses dominate market share in Japan
- Important seafood industry groups exported to Australia
- Prime Minister encourages Australian companies to make investments in fresh growth drivers in Vietnam
- Foreign E-commerce businesses pay over 2,000 billion VND in tax in the first two months of the year
Đọc thêm Business
Long An enhances innovation and attracts high-tech investment
On April 25, 2024, as part of a business trip to South Korea, the Long An provincial delegation visited, worked and surveyed the Jeju Free International City Development Center (JDC).
Vietnam's economic and manufacturing sectors continue to recover
Domestic production and business activities have shown positive signs and brighter prospects for the national economy. With important factors and achievements, our country has achieved economic recovery.
Green transition helps Vietnam’s textile industry increase its competitiveness in the international market
The transition to green production and business is a major trend. Accordingly, the Vietnamese textile industry is no exception, applying sustainable solutions and green transition will help increase its competitiveness in the international market.
Hai Phong ranks 2nd out of 63 provinces and cities in the PAR INDEX with 91.81%
According to the 2023 PAR INDEX ranking results, Hai Phong ranked 2nd out of 63 provinces and cities with a result of 91.81%.
Which Vietnamese company is pioneering the development of a coffee production area that complies with the EUDR?
The EUDR requirement is a strong warning that consumer markets take the environmental protection actions of the producing country very seriously.
Vietnam’s live-stream market witnesses a sharp increase
Figures from the Coc Coc platform show that around 77% of survey participants have watched a live-stream sale, of which 71% have purchased the live-stream session.
Tourism recovery brings Hanoi’s hotel segment back to its prime
According to experts, the recovery of tourism has boosted the hotel market. In addition, with the closure of low-quality supply, the market is considered to be in good shape.
Vietnam’s Marine Economy - Importance and Prospects for Growth
The marine economy plays a crucial role in the prosperous development of the country. With over 3,260 km of coastline, Vietnam possesses vast marine resources, including seafood, oil and gas, wind energy, marine tourism, and maritime transport.
The bright future of the Vietnamese automotive industry
In the future, the Vietnamese electric car industry will make a breakthrough to become one of the industries contributing to the country's sustainable development. Thus, the electric car industry will certainly develop strongly in the coming time.
The economy of Binh Duong grows positively and recovers strongly
In the first quarter of 2024, Binh Duong province’s socio-economic situation continued to have positive changes, gradually recovering well, with most indicators increasing compared to the same period in 2023.