Vietcombank has asked the government to scrap the requirement that commercial banks withhold and pay taxes on behalf of foreign entities without a physical presence in Vietnam, The Investor has reported→view source.
The bank is arguing that it is unfeasible and inconsistent with global norms.
Key reasons for the proposal:
- Lack of transaction context: Vietcombank said banks only execute fund transfers and are not party to the underlying commercial transactions. They cannot determine the transaction’s nature or the applicable tax rate.
- Insufficient customer data: Transfer orders typically do not include website information, making it impossible to match transactions with the tax authority’s list of non-registered foreign suppliers.
- Name ambiguity: Similar or identical supplier names across countries could lead to incorrect withholding.
- Mismatch with international norms: The bank cited OECD standards and practices in the US, EU, and Australia, where digital platforms—not banks—are responsible for tax compliance.
- Law No. 56/2024 shift: The amended law requires foreign suppliers to register and pay taxes themselves or via authorised representatives, aligning with Vietcombank’s position.
Vietcombank’s push reflects growing resistance from the banking sector against being tasked with indirect tax enforcement.
It underscores the tension between expanding e-commerce tax capture and ensuring administrative feasibility for intermediaries like banks.
See also: Tax in Vietnam 2025 Explained: CIT, VAT, PIT & More