Feedback sought on tax exemption for fizzy drinks

Jul 16th at 10:07
16-07-2014 10:07:22+07:00

Feedback sought on tax exemption for fizzy drinks

 Viet Nam's policy-making bodies may reconsider a proposal to exempt non-alcoholic carbonated drinks from the list of products subject to an excise tax rate of 10 per cent.

 

Previously, a draft amendment by the Ministry of Finance to the Excise Tax Law included fizzy soft drinks in a list of 16 products subject to the tax. The ministry claimed that as these drinks posed a health risk, the tax would help prevent the risk and substantially increase government revenue.

However, after putting the draft amendment up public review in February, the 10 per cent excise tax on soft drinks came under intensive public scrutiny.

Now, the amendment makers would like to hear what the public would think if they don't impose the tax.

At a meeting earlier this month, Deputy Head of Department of Tax Policy cum representative of the amendment-making board said that it has more than 100 comments on the subject.

The high level of public scrutiny indicated the importance of the tax policy, he said.

Therefore, the amendment-making board would add another proposal to exempt non-alcoholic carbonated drinks from the excise tax.

Deputy Head of the National Assembly's Committee on Financial and Budgetary Affairs Dinh Trinh Hai said decision makers would need to listen to more parties before ratifying the amendment.

Excise tax on carbonated drinks would be unfair and reflect poorly on the draft makers, said Nguyen Duc Kien, deputy head of the National Assembly's Economic Committee.

Kien said all soft drinks contained sugar or sweeteners, therefore if the ministry aimed to raise budget money with the tax, it should impose the tax on all canned drink products.

Vo Thi Lan Phuong, managing director of Vriens&Partners said that the draft amendment should include proposals to exempt or impose excise tax on soft drinks, regardless whether they were carbonated.

She said that the explanations by amendment makers on the health risks were not clear.

Deputy Head of Viet Nam Food Association, the Ministry of Health Nguyen Hung Long, said that carbon dioxide, preservatives, sweeteners and food colorants in carbonated drinks were already tested by the FAO/WHO Codex Committee.

These food addictives were proven not to cause health risks if the use of additives followed Codex standards.

From an economic stance, chairman of Viet Nam Tax Consultants Association Nguyen Thi Cuc said that the tax was not reasonable if the country was calling for foreign investment.

Foreign investors control about 80 per cent of the soft drink market in Viet Nam.

Cuc said that if Viet Nam must impose the tax for the sake of people's health, the policy-makers should set out guidelines to get enterprises prepared.

Another expert from Viet Nam Chamber of Commerce and Industry said that Viet Nam may be sued if it imposes the tax.

Some legal advisors told the meeting that Viet Nam could not use State rights to impose the tax without presenting transparent and reasonable rationales.

Instead, it needed to get taxpayers to agree with their tax policies.

bizhub



NEWS SAME CATEGORY

An Binh, Maybank connect ATM networks

The An Binh Joint Stock Commercial Bank and Malaysia's largest bank, Maybank, successfully connected their ATM networks on Monday.

Vietinbank gives $7.6 million for FDI project

The Vietinbank branch in the southern Binh Duong Province and the Medochemie Far East Company Ltd signed a US$7.6-million credit contract on Monday.

BIDV funds Ninh Thuan project

The Bank for Investment and Development of Vietnam (BIDV) yesterday signed an agreement to finance a medical equipment project for the central province of Ninh...

Four more commercial banks offer online tax payments

The General Department of Taxation under the Ministry of Finance and four commercial banks signed an agreement to facilitate online tax payments on July 11 in Ha...

Larger lenders on track to hit annual targets

Several banks have posted satisfactory profits, achieving around half of the annual targets, during the first half of this year, the Sai Gon Dau Tu (Sai Gon...

Banks eye ways to convert deposit boom into lending

Commercial banks are seeking ways to boost lending as bank deposits have increased in the past few months.

State Bank to crack down on bitcoin exchange

The State Bank of Viet Nam will work with the public security forces to seize operators of the Viet Nam real-time bitcoin exchange (VBTC) that was launched on...

Banks achieve half their annual profit targets

Several banks have posted satisfactory profits, achieving around half of the annual targets, during the first half of this year, the Sai Gon Dau Tu (Sai Gon...

Central bank assuages foreign currency lending fears

Increasing foreign currency lending does not present a risk to the Vietnamese economy, said Nguyen Thi Hong, director of the Monetary Policy Department under the...

Businesses rush to buy dollars, betting on carry-trade deals

In its report released on July 2, the Vietnam National Finance Supervision Council highlighted the sharp increase in outstanding loans in foreign currency, warning...

Bank stocks

Insurance stocks


MOST READ


Back To Top