E-Commerce Platforms Like Shopee and TikTok Shop Must Now Withhold Taxes on Behalf of Sellers in Vietnam

Vietnam has introduced a sweeping new tax regulation that reshapes how online sellers fulfill their tax obligations, placing much of the burden directly on major e-commerce platforms. Under the new rules, platforms such as Shopee and TikTok Shop will be required to automatically deduct and remit taxes on behalf of individual sellers operating through their systems.

The regulation marks a significant shift in tax collection strategy, as authorities seek to close loopholes in the rapidly growing digital economy. By assigning tax withholding responsibilities to the platforms themselves, the government aims to improve compliance rates and ensure that revenue generated through online commerce is properly reported and collected.

However, sellers who operate through social media channels such as Facebook, Zalo, and Instagram will not benefit from this automatic system. These individuals will be required to personally declare and submit their taxes in accordance with existing regulations, placing a greater administrative responsibility on those who conduct business outside of formal marketplace platforms.

Tax experts warn that social media-based sellers in particular should familiarize themselves with their obligations to avoid penalties. With Vietnam's e-commerce sector continuing to expand at a rapid pace, authorities are expected to increase scrutiny on undeclared online income across all digital channels in the months ahead.

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