Netflix Inc NFLX and Apple Inc AAPL are under fire in Vietnam for allegedly failing to pay taxes, Reuters reported Wednesday (Hanoi Time).
What Happened: Vietnam’s information and communication ministry said the companies have combined revenue of $43.15 million from nearly one million subscribers in the Southeast Asian nation but have never paid tax there.
“Domestic companies have to abide by tax and content regulations while foreign firms do not, which is unfair competition,” said the country’s information minister Nguyễn Mạnh Hùng, as per Reuters.
A Netflix spokesperson said that it was supportive of efforts that would make it possible for foreign service providers like itself to “collect and remit taxes in Vietnam,” Reuters reported. The company spokesperson claimed that “such a mechanism does not exist.”
Why It Matters: The Philippines, Thailand, and Indonesia have all recently passed or drafted laws that would make it binding on foreign streamers to pay taxes locally, noted Reuters.
Hùng reportedly said that the information ministry and Vietnam’s tax department are taking measures to ensure these firms pay taxes from the time of their entry into the country’s market.
In February, state-owned telecom companies allegedly brought down Facebook Inc’s FB servers for seven weeks leading it to bow down to censorship.
Price Action: Netflix shares closed nearly 2.1% higher at $480.24 on Tuesday and gained 0.57% in the after-hours session. On the same day, Apple shares closed 0.3% lower at $115.97.
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