Gold export duty increased to 2%
Gold export duty increased to 2%
The finance ministry (MoF) has increased the export duty on gold jewellery of more than 95% purity from zero to 2%.
The decision was announced in the MoF's amended Circular 36, issued on March 23, which said the new duty would take effect on May 7, 2015.
MoF said it aimed to implement Deputy Prime Minister Vu Van Ninh's directive on gold duty, which was also requested by the tax policy department last year.
Meanwhile, the amended circular has maintained 0% duty on gold jewellery of 95% purity or less.
Last November, the Vietnam Gold Trades Association (VGTA) asked MoF not to increase the duty because it would affect the local gold businesses.
VGTA said local businesses had no access to domestic bank credit, even though they had to pay a higher price for raw materials for their production.
On March 27, the price of one tael (1.205 ounce) of gold in Vietnam was US$218 higher than the world market price.
Since May 2012, SBV has been the only gold importer in Vietnam. This was done to manage the local gold market.
As a result, local businesses could not import gold to lower their production costs.
The association said foreign competitors such as China, Thailand, Indonesia and India not only had better technology, but also were allowed to import gold, with no export duty being imposed on gold jewellery.
However, MoF found that the increase in export duty would not affect local businesses as most of them made jewellery with gold that was less than 95% pure.
Phu Nhuan Jewellery Company (PNJ), the enterprise with the largest gold jewellery export revenue in Vietnam, told local media it used gold of less than 95% purity to make jewellery.
The amended circular also appointed organisations that could measure the gold content in jewellery sold in the domestic market. They comprise two centres of quality assurance and testing under the science and technology ministry, DOJI Institute and Laboratory for Gemology and Jewellery, ACB and organisations with permission from the directorate for standards, metrology and quality.
