The Government has agreed with the Ministry of Finance's final draft lawand not included carbonated soft drinks to the list of items subject tospecial consumption tax.
At July's regular Government meeting,the Finance Ministry submitted to the Government the final draft Law onSpecial Consumption Tax, in which it asked the Government for approvalnot to apply the 10 percent special consumption tax rate as this is inline with the country's integration into the word's economy.
Ifapproved by the National Assembly, the beverage will continue to itscurrent zero percent tax rate. The Government will submit the reviseddraft law to National Assembly deputies for discussions this October,and if passed, it would come into effect from July 2015.
InFebruary, the Ministry of Finance released its first draft Law on theSpecial Consumption Tax that imposed a 10 percent tax on carbonated softdrinks, citing several studies that pointed out the potentially harmfuleffects of soft drinks on public health. The ministry said that theirconsumption should be controlled in the same way as that of cigarettesand alcohol.
However, the Ministry of Planning and Investmentdismissed the Finance Ministry's proposal and explanation asunconvincing, casting doubts on the argument about the negative impactof carbonated soft drinks on consumer health.
The Ministry ofIndustry and Trade also expressed concern that the special consumptiontax would hit both foreign and domestic producers of carbonated softdrinks if such a tax was levied.
The proposal had also met withstrong objections from foreign business groups and associations inVietnam since it made the headlines.
Proposals for the exemptionof special consumption tax on naphtha, condensate and other substancesused for gasoline blending are expected to go to the table of NAdeputies in October when they debate draft supplements and amendments tothe Law on Special Consumption Tax.
Under the draft law,cigarettes, cigars, wines and beers at the duty-free areas will still besubject to this tax in a bid by the Government to reduce consumption ofthese products and to fight trade fraud.
The tax on cigarettesis proposed to be adjusted up from 65 percent to 75 percent and 85percent from 2018. The suggested tax will rise from 50 percent to 65percent for drinks with an alcoholic volume of at least 20 percent and25 percent.
The taxes are expected to contribute more than 2.9trillion VND, 131.82 million USD, to the State budget in 2016 and 7.7trillion VND, or 350 million USD, in 2018.-VNA
At July's regular Government meeting,the Finance Ministry submitted to the Government the final draft Law onSpecial Consumption Tax, in which it asked the Government for approvalnot to apply the 10 percent special consumption tax rate as this is inline with the country's integration into the word's economy.
Ifapproved by the National Assembly, the beverage will continue to itscurrent zero percent tax rate. The Government will submit the reviseddraft law to National Assembly deputies for discussions this October,and if passed, it would come into effect from July 2015.
InFebruary, the Ministry of Finance released its first draft Law on theSpecial Consumption Tax that imposed a 10 percent tax on carbonated softdrinks, citing several studies that pointed out the potentially harmfuleffects of soft drinks on public health. The ministry said that theirconsumption should be controlled in the same way as that of cigarettesand alcohol.
However, the Ministry of Planning and Investmentdismissed the Finance Ministry's proposal and explanation asunconvincing, casting doubts on the argument about the negative impactof carbonated soft drinks on consumer health.
The Ministry ofIndustry and Trade also expressed concern that the special consumptiontax would hit both foreign and domestic producers of carbonated softdrinks if such a tax was levied.
The proposal had also met withstrong objections from foreign business groups and associations inVietnam since it made the headlines.
Proposals for the exemptionof special consumption tax on naphtha, condensate and other substancesused for gasoline blending are expected to go to the table of NAdeputies in October when they debate draft supplements and amendments tothe Law on Special Consumption Tax.
Under the draft law,cigarettes, cigars, wines and beers at the duty-free areas will still besubject to this tax in a bid by the Government to reduce consumption ofthese products and to fight trade fraud.
The tax on cigarettesis proposed to be adjusted up from 65 percent to 75 percent and 85percent from 2018. The suggested tax will rise from 50 percent to 65percent for drinks with an alcoholic volume of at least 20 percent and25 percent.
The taxes are expected to contribute more than 2.9trillion VND, 131.82 million USD, to the State budget in 2016 and 7.7trillion VND, or 350 million USD, in 2018.-VNA
