South Korean tax investigation draws spotlight to Netflix issues in Vietnam
South Korean tax investigation draws spotlight to Netflix issues in Vietnam
Netflix coming under investigation for possible tax avoidance in South Korea gives more substance to similar allegations in Vietnam where it has yet to pay a dime in taxes after four years of operations.
The South Korean division of Netflix is currently under investigation for possible tax avoidance
|
According to newswire Yonhap, the National Tax Service (NTS) in South Korea suspects Netflix Services Korea paid its US headquarters a large sum of phantom management consulting fees so that the Seoul office would report a deficit and avoid paying corporate taxes.
An official at Netflix Services Korea confirmed that NTS officials had visited the office and said that Netflix was fully cooperating with the tax authorities.
In Vietnam, Netflix has so far not received a licence, despite running business here for more than four years, and has so far refused to offer an explanation.
According to Vietnam’s Ministry of Information and Communications (MIC), many movies and series on the platform could be found in violation of local regulations.
Along with the licensing problem, Netflix has also been accused of tax avoidance for a long time now. According to the MIC, since its initial launch in Vietnam in 2016, the company has yet to pay any tax to local authorities, despite annual revenues of $30 million.
Currently, the Ministry of Finance is drafting specific tax rates for cross-border services for publishing within this year.
Reacting to the claims, Amy Kunrojpanya, public affairs and communications leader at Netflix, told VIR, “In every country we operate, Netflix respects the rules. We have been honoured to meet regularly with Vietnamese authorities on this topic and await further details on implementation from them.”
However, it has been more than nine months since the last meeting between Netflix and the Government Office and no specific action has been made by Netflix.
