Foreign firms like Facebook and Google dominate the digital ad market in Vietnam but pay no taxes, a minister says.
Facebook and Google account for the majority of Vietnam's ad revenue. Photo by Reuters/Regis Duvignau
Minister of Information and Communications Nguyen Manh Hung said this has to change.
While foreign companies like Google and Facebook account for 70 percent of Vietnam digital ad revenues, they neither pay taxes nor comply with Vietnamese laws, Hung noted at a forum Thursday on developing Vietnam technology companies.
"Vietnam has its own sovereignty, laws and forces, and we cannot allow this situation to continue. We must strive to have every foreign business comply with our laws," he said.
Last year, Facebook and Google accounted for 66.7 percent of Vietnam’s ad revenue, which was $550 million, according to market research firm ANTS.
The market share of these two global giants will rise to 69 percent this year, while thousands of Vietnamese advertising agencies account for just 28 percent.
Both Facebook and Google do not have a representative office in Vietnam. The country’s cybersecurity law, which took effect at the beginning of this year, requires foreign businesses to open representative offices in Vietnam and store their Vietnamese users' data in Vietnamese territory.
Minister Hung has previously proposed that new policies are issued to facilitate the creation and growth of homegrown social networks, aiming to garner at least 60 million accounts and 60-70 percent of the social network market’s pie in Vietnam by 2022.
But for now, Facebook remains the most popular social network in the country. The number of Facebook users in Vietnam is the seventh highest in the world with over 58 million people last year, an increase of 16 percent from 2017, according to marketing agency We Are Social.VNA/VOV