Vietnam’s taxes and fees higher than those of other developing countries

Vietnam’s taxes and fees higher than those of other developing countries

VietNamNet Bridge – The taxes and fees Vietnamese businesses have to bear are higher than those in other developing economies, thus weakening their competitiveness.

Tran The Dung, deputy director of The He Tre Tourist Company, said fees of different kinds, from sightseeing fees to road taxes, from official to “underground” fees, from reasonable to unreasonable, are one of the reasons behind high tour fees.

The sightseeing fees at tourist sites, for example, account for 7-10 percent of total tour fees. It is even higher at national cultural heritages or well-known tourist sites.

Meanwhile, toll and bus stop fees account for 5 percent of total tour fees. There are high transportation fees for vehicles that travel in Binh Duong and Binh Phuoc provinces, where there are numerous fee collection stations.

In addition, travel firms have to pay many other kinds of unreasonable fees. If their travelers stay overnight at Ha Long Bay, they have to pay an overnight fee. If travelers stay overnight at Y Ty stone plateau in Lao Cai Province, they have to pay a VND20,000 fee each to the local authorities.

According to Dung, travel firms have to pay some fees twice for every trip to some localities. Besides the fixed rates made public by the local authorities that must be paid, the firms must also pay fees directly to officers from local agencies.

In most cases, privately run restaurants or street shops do not issue VAT (value added tax) invoices, because they do not have to follow business accountancy rules. As a result, travel firms have to pay their own money for VAT, even though VAT, in principle, is taxed on consumers.

Ad firms also complain about high taxes and fees. Do Kim Dung, deputy chair of the HCM City Advertisement Association, noted that ad firms must pay more fees to obtain licenses to install billboards when the number of administrative procedures increase.

According to Dung, who is also the CEO of An Tiem Ad Firm, under the Advertisement Law which took effect on January 1, 2013, ad firms are not required to obtain licenses from state agencies, but they only have to file an advertisement registration with the agencies.

The law was created to give favorable conditions for ad firms to provide services so the firms would not have to waste time to contact government agencies to ask for licenses. However, in fact, it made the situation even worse.

The problem is that the city’s authorities still have not defined the places for outdoor billboards. Therefore, ad firms can install their billboards for six months only. After every six-month period, they have to follow administrative procedures to install billboards from the very beginning.

The unofficial fees, Dung said, push the ad costs up. In order to install a billboard in the Ben Thanh Market area, one would have to pay $200,000 a year, of which the premises rent accounts for 25 percent and the installation costs 10 percent.

NLD

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