Brian Jeffrey
Proposed Changes to Corporate Income Tax for Media Outlets
The Ministry of Finance (MOF) is seeking feedback on a draft amendment to the corporate income tax law. This proposal suggests a reduced tax rate of 15% for press agencies, including advertisements in newspapers, representing a 5% decrease from the existing rate. In addition, print newspapers may qualify for a 10% tax rate.
Critics argue that a 15% tax remains too high, especially as the media sector is currently facing numerous challenges.
Call for Equal Tax Rates Across Media Types
Nguyen Duc Loi, deputy chair of the Vietnam Journalist Association (VJA), emphasized the need for a uniform tax benefit across all media formats, including online newspapers and broadcasting, rather than just for print publications. He pointed out that the advertising revenue, a critical income source for press agencies, is decreasing as advertisers increasingly turn to global platforms like Google and Facebook.
The challenges have intensified following the Covid-19 pandemic, which has resulted in reduced advertising budgets for many companies.
Support Needed for Press Agencies
Loi underscored that the government has extended tax relief to various sectors, and he advocates for similar support for the media. He stated that press agencies are primarily focused on public service, promoting the policies of the Party and State, rather than functioning as typical businesses.
He believes a tax rate of 10% for all media types would be more appropriate, noting that contributions from press agencies to the state budget are minor and that these outlets require assistance.
The VJA has yet to receive formal requests from its member agencies regarding tax reductions; however, it is aware of their concerns through discussions at recent forums.
The pay for journalists remains low compared to the average income, prompting the VJA to address this issue with state authorities.
The National Assembly’s Committee for Culture and Education has met with the Ministry of Information and Communications and reached a consensus to recommend a 10% tax rate for press agencies.
The press serves as a vital mechanism for communicating the Party and State’s policies to the populace. If the state does not provide direct support, it should facilitate avenues for media to generate revenue. Excessive taxation could undermine the sustainability of these agencies.
Advocating for Preferential Tax Treatment
Do Chi Nghia, a member of the National Assembly’s Committee for Culture and Education, highlighted the urgent need for favorable tax rates for newspapers. He remarked on the visible struggles of press agencies and emphasized that now is the time to proceed with tax cuts for the media.
Some analysts have pointed out that press agencies face a contradictory situation; while deemed “public non-business units” tasked with political and social responsibilities, they are simultaneously treated like businesses subject to taxation.
Nghia acknowledged the significant role of the press historically and its importance during the country’s reform process led by the Communist Party. He reiterated that press agencies merit fair treatment and that their development aligns with both societal interests and the Party’s objective of advocating for ideological leadership.
