Companies

HCM City (VNS/VNA) – Businesses would be required to use non-cash payments for trading transactions of any value under a proposal submitted to the Government by the Ho Chi Minh City Tax Department .

Currently, trading transactions worth more than 20 million VND (868 USD) have to be made by cashless payment in order to enjoy tax refunds and corporate income tax reductions as regulated by the law on value-added tax.

The proposal is aimed at improving tax governance and strengthening monitoring of expenditures and turnover of businesses and traders, according to an official at the tax department.

The official said that payments using non-cash methods have become increasingly popular in Vietnam, and the Government last year issued a resolution to boost cashless payments in the country.

The department also proposed that the Government create regulations for e-commerce or digital-based business activities conducted by foreign companies like Google, Facebook, YouTube, Agoda, Booking.com and Airbnb.

These companies would be required to provide tax agencies information on individuals and businesses in Vietnam involved in their business activities.

The department also proposed that the Government set regulations concerning investigation of tax fraud and related crimes.

Associate professor Dinh Trong Thinh of the Academy of Finance said it was vital to speed up cashless payments to reduce the risks involved in cash payments and to increase financial transparency.

However, limited payment infrastructure was one of the barriers hindering electronic payment adoption, he said.

Regulations on non-cash payments for all transactions should not be required, he said. There should be a detailed roadmap to implement regulations on non-cash transactions to make it feasible, especially for small enterprises, he added./.

VNA

Digital transformation is deemed an evitable trend which helps the firms surmount the adverse impact of COVID-19, as well as a key to sustainable development.

The pandemic has dealt a major blow to this economic sector with over 95 percent of companies severely affected.

CEO of Travelogy Vietnam Vu Van Tuyen said that IT applications help businesses to optimise personnel and system management, so as to improve efficiency and competitive edge.

In addition, technology also creates connection between firms, fostering transparency and sustainable development, he added.

To meet demand of tourists, travel companies have devised virtual or interactive tours embellished with images, videos, sound effects and music.

When it comes to applying digital transformation, firms are advised to take consumer psychology into account in an attempt to build a suitable roadmap.

The acceleration of digital application is vital to supervise tourism activities and support COVID-19 prevention and control measures, as well as ensure long-term business of the sector, Ha Van Sieu, Deputy Director General of the Vietnam National Administration of Tourism (VNAT), has said.

To support stakeholders, the VNAT has rolled out a project on a smart tourism operation centre that will connect with customers and coordinate with telecommunication units.

Localities are asked to guide firms in signing up for a COVID-19 safety self-assessment system and an app on safe tourism, which have seen the registration of all 64 provinces and cities in the country.

A cut of steel prices from Vietnam’s major steelmakers will drive up the domestic market in the next months.

Vietnamese businesses are hoping to maintain stable prices of steel products from now on until the end of this year after the market has witnessed a decline in prices in recent weeks.

The cut of still prices announced by the local major steelmakers on June 9 is seen as a poke to push back the stagnancy of the steel market, which had had a price hike since late 2020.

Steel production at Siam Steel Vietnam. Photo: Hai Linh

Hoa Phat Group quoted the price of rolled steel model CB240 at VND17.2 million (US$750) per ton, down by nearly VND1 million (US$43) from the peak at VND18.3 million (US$794) recorded one month ago, while the price of steel bar also decreased by VND500,000-700,000 (US$21.7-30.3) per ton.

Prices of rolled steels produced by Viet Duc steel are also cut by VND960,000 (US$42) per ton against early June to VND17 million (US$738).

Vice Chairman of the Vietnam Steel Association (VSA) Do Xuan Chieu said lower steel prices in the domestic market was due to the decline in prices of input materials, including iron ore, steel ingots, which make up 70-80% of the list prices.

Chieu referred to the fact that most-traded September iron ore on China’s Dalian Commodity Exchange ended at the lowest point since June at US$173.03 per ton, while the July contract for iron ore on the Singapore Exchange also declined by 2% to US$173.03.

“A stagnant in steel demand from the Chinese market has led to prices decline,” said Chieu.

In the Vietnamese market, VSA Chairman Nghiem Xuan Da attributed freezing construction activities as in the rainy season in June and July to low demand for steel.

According to Da, the peak season for construction would normally fall in the first and fourth quarters of the year.

“The declines, however, remain modest at around 3-5%, as steel prices are expected to go up as construction activities heat up,” he noted.

A recent report from Fitch Solutions suggested global steel prices would reach US$800 per ton in the final half of this year, an increase of US$140 per ton against its previous forecast, pointing out an imbalance between supply and demand.

Fitch Solutions experts have also said that the decline in steel prices would be insignificant as consumption demand is forecast to go up.

Steel prices are predicted to moderate to around US$600 per ton by 2022, stated Fitch Solutions.

Halt on increasing steel prices

To further halt the steel price hiking, Da from the VSA noted that along with keeping operational costs at an efficient level, local steel producers should prioritize domestic markets as measures to prevent steel prices from surging.

“Policies from the government are needed to temporarily discourage steel exports,” Da said.

At a recent meeting with local steel producers, Minister of Industry and Trade Nguyen Hong Dien stressed the necessity for local firms to focus on iron ore mining and processing, in turn creating stable supplies of input materials for steel production.

“Vietnamese steel producers should pay more attention to the R&D process to better ensure the supply sources and produce higher quality steel products,” he added.

Economist Vu Dinh Anh told The Hanoi Times that as steel prices are driven by the market, construction companies should draft plans to keep a hold on steel supplies to minimize impacts from rising steel prices.

“The government can only intervene when there is a major disruption to the local market,” Anh said.