With this article in Vietnam Investment Review, here, the government proves that it is capable of keeping pace with technological advancement in at least one department, that of tax collection.
The article examines the fact that Grab, a ride hailing app company, has surpassed Vinasun in tax contributions. It outlines the concerns that were raised initially, primarily the fact that Grab may not be amenable to easy tax collection, one of the arguments raised by the taxi union to fight what has been a major blow to taxi business.
The tax department has responded with technology and advanced regulations. Instead of sitting idly by and relying on traditional tax collecting methods, the tax department has come up with a way to monitor digital transactions, something it is transitioning to other digital technology.
One thing this proves is that the government can keep up with at least the tax aspect of technological advancement, even though it may struggle with the regulation of that technology.
This is a boon for startups, including fintech outfits, that are facing regulation from Jurassic government regulators. Led by the tax department, which is ultimately the most important one, the government is going to be sensitive to the growth of lucrative sectors. This is especially true in light of their recent stated goal of 1,000,000 SMEs by 2020.
Although this means more taxes, the technology is apt to bring about eventual change in regulation to allow for the tech itself. Just because the tax department sees a way to increase tax collection. Hit them where it hurts, in the pocket book.
