Vietnamese Grab bike riders wait for passengers in HCM City. (Photo: vietcetera.vn)Hanoi (VNA) - The Ministry of Finance (MoF) will continue coordinatingwith the State Bank of Vietnam and other competent authorities to review theuse of Malaysian company Grab’s grants from the mother company to its localbranch.
Thepurpose is to prevent and promptly handle any probability of tax evasion.
In itswritten response to questions from National Assembly deputy Pham Van Hoa fromDong Thap province during the fourth session of the 14th National Assembly inNovember, the MoF announced it has taken action against any tax fraud relatedto Grab’s business activities in Vietnam.
Hoaraised a question on the clarity and accuracy of tax filing, tax return andexemption, and responsibility of both taxpayers and the authority, by givingthe example of Grab having charter capital of 20 billion VND (890,800 USD) andincurring a staggering three years’ loss of 938 billion VND (41.7 million USD),which he considered a sign of tax fraud.
TheMoF has since instructed corresponding tax offices to carry out inspections ofGrab and revise its tax profile for 2014, 2015 and 2016.
Resultsfrom the inspection show a loss reduction of 56.6 billion VND (2.52 million USD)for Grab, which the MoF attributed to a surge of 8.5 billion VND (378,600 USD)in recorded revenue and a reduction of 48.1 billion VND (2.14 million USD) insubsidised auxiliary costs, sales promotion and other irregular expenses.
Theloss is mainly due to marketing costs, spent on the company’s advertisingcampaign in the last three years, coupled with its cheaper price in comparisonwith regular taxis, due to which it wasn’t able to break even on all accounts.
Moneysupply for Grab’s branch operations in Vietnam comes from its parent company inMalaysia, which has currently accumulated to $50 million, sans interest.
Grabhas paid up to 140 billion VND (6.2 million USD) in tax from January to October2017.
The MoF promised further probe ofthe company’s financial situation in the near future, with tighter watch onother foreign entities operating in Vietnam.-VNA
VNA
