Are marine plants subject to severance tax in Vietnam?

Are marine plants subject to severance tax in Vietnam?

Based on Article 2 of the Law on severance tax 2009 (amended by Clause 1, Article 4 of the Law Amending Various Tax Laws 2014), the taxable objects are stipulated as follows:

- Metallic minerals.

- Non-metallic minerals.

- Crude oil.

- Natural gas, coal gas.

- Products from natural forests, excluding animals.

- Natural aquatic products, including marine animals and plants.

- Natural water, including surface water, and groundwater, except for natural water used for agriculture, forestry, fishery, and salt production.

- Natural bird nests.

- Other resources prescribed by the Standing Committee of the National Assembly.

Therefore, according to the regulations, natural aquatic products, including marine animals and marine plants, are subject to severance tax.

Are marine plants subject to severance tax in Vietnam? What is the tax rate? (Image from the Internet)

Do individuals who purchase harvested marine plants have to pay severance tax in Vietnam?

According to Article 3 of the Law on severance tax 2009, the taxpayers are stipulated as follows:

- Taxpayers of severance tax are organizations and individuals that exploit resources subject to severance tax.- Taxpayers of severance tax in certain cases are specifically defined as follows:

+ In the case of a joint venture enterprise exploiting resources, the joint venture enterprise is the taxpayer;
+ In the case of a Vietnamese party and a foreign party participating in a business cooperation contract for resource exploitation, the tax liability of the parties must be specifically defined in the business cooperation contract;
+ **Organizations and individuals that exploit resources on a small scale** and sell them to organizations or individuals that act as purchasing intermediaries. If these intermediaries commit in writing to declare and pay taxes on behalf of the exploiting organization or individual, then the intermediaries are the taxpayers.

The regulation states that if an organization or individual acting as a purchasing intermediary commits in writing to declare and pay taxes on behalf of the exploiting organization or individual, then the intermediary is the taxpayer.

Therefore, it can be understood that in the case of an individual acting as an intermediary to purchase harvested marine plants and commits in writing to declare and pay taxes on behalf of the exploiter, then they must pay the severance tax.

What are the tax rates of severance tax applicable to marine plants in Vietnam?

Based on Article 7 of the Law on severance tax 2009, the tax rates are stipulated as follows:

- The framework for severance tax rates is stipulated as follows:

- Specific tax rates for crude oil, natural gas, and coal gas are determined progressively by the average daily production of crude oil, natural gas, and coal gas.

- Pursuant to the provisions of Clauses 1 and 2 of this article, the Standing Committee of the National Assembly stipulates specific tax rates for each type of resource in each period, ensuring the following principles:

+ Compliance with the list of resource categories and within the tax rate framework prescribed by the National Assembly;
+ Contributing to state management of resources; protecting, exploiting, and using resources rationally, economically, and effectively;
+ Contributing to ensuring state budget revenue and market stability.

Thus, it can be seen that depending on the type of marine plants, different tax rates apply: If they are pearls, abalone, or sea cucumbers, the tax ranges from 6-10%, and if they are other natural aquatic products, the tax ranges from 1-5%.