What is the environmental protection tax rate on plastic bags in Vietnam?
What is environmental protection tax in Vietnam?
Pursuant to Clause 1 Article 2 of the Law on Environmental Protection Tax 2010, environmental protection tax is defined as an indirect tax, levied on products, goods (hereinafter collectively referred to as goods) that, when used, have a negative impact on the environment.
Additionally, according to Article 5 of the Law on Environmental Protection Tax 2010, the taxpayers include:
- Organizations, households, and individuals who produce or import goods that are subject to tax as stipulated in Article 3 of the Law on Environmental Protection Tax 2010.
- Taxpayers in specific cases are stipulated as follows:
+ In the case of goods importation via entrustment, the entrusted importer is the taxpayer;
+ In the case of small-scale coal mining by households, if the responsible parties cannot present proof of having paid the environmental protection tax, then the organizations, households, or individuals that serve as the focal point for purchasing such coal are the taxpayers.
Are plastic bags subject to environmental protection tax in Vietnam?
According to Clause 4 Article 1 of Circular 152/2011/TT-BTC (amended and supplemented in Article 1 of Circular 159/2012/TT-BTC):
Taxable Objects
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4. Taxable plastic bags are those that are thin plastic bags or packaging with a bag shape (with bag mouth, bottom, and sides, capable of containing products) made from single-layer plastic film HDPE (high density polyethylene resin), LDPE (low density polyethylene resin), or LLDPE (linear low density polyethylene resin), except for pre-packaged goods and plastic bags that meet environmentally friendly criteria from the date they are certified as environmentally friendly by the competent authority according to the regulations of the Ministry of Natural Resources and Environment.
Pre-packaged goods packaging (whether bag-shaped or non-bag-shaped) is specified as follows:
a) Pre-packaged goods packaging includes:
a1) Pre-packaged imported goods packaging.
a2) Packaging produced or imported by organizations, households, or individuals for packaging products produced, processed, or purchased by them, or for providing packaging services.
...
a3) Packaging bought directly from the producer or importer for packaging products produced, processed, or purchased by them, or for providing packaging services.
Example 3: Enterprise B buys 200 kg of packaging directly from Enterprise A (the producer or importer) to package shirts (produced, processed, or purchased by Enterprise B), then this 200 kg packaging is not subject to environmental protection tax.
Packaging that the buyer does not use to package products (with a commitment to use the packaging for packaging products) but uses for exchange, internal consumption, gifting, or selling to other organizations, households, or individuals, then the buyer must declare and pay the environmental protection tax to the directly managing tax authority and be handled according to the tax management regulations.
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Therefore, plastic bags are subject to environmental protection tax.
Taxable plastic bags are those that are thin plastic bags or packaging with a bag shape (with bag mouth, bottom, and sides, capable of containing products) made from single-layer plastic film HDPE (high density polyethylene resin), LDPE (low density polyethylene resin), or LLDPE (linear low density polyethylene resin).
What is the environmental protection tax rate on plastic bags in Vietnam? (Image from the Internet)
What is the environmental protection tax rate on plastic bags in Vietnam?
According to Article 8 of the Law on Environmental Protection Tax 2010:
- The absolute tax rate is regulated by the following Tax Bracket:
| No. | Goods | Unit | Tax Rate (VND/unit) |
|---|---|---|---|
| I | Gasoline, oil, lubricants | ||
| 1 | Gasoline, excluding ethanol | Liter | 1,000-4,000 |
| 2 | Jet fuel | Liter | 1,000-3,000 |
| 3 | Diesel fuel | Liter | 500-2,000 |
| 4 | Kerosene | Liter | 300-2,000 |
| 5 | Fuel oil | Liter | 300-2,000 |
| 6 | Lubricating oil | Liter | 300-2,000 |
| 7 | Lubricating grease | Kg | 300-2,000 |
| II | Coal | ||
| 1 | Brown coal | Ton | 10,000-30,000 |
| 2 | Anthracite coal (anthracite) | Ton | 20,000-50,000 |
| 3 | Cooking coal | Ton | 10,000-30,000 |
| 4 | Other coal | Ton | 10,000-30,000 |
| III | Hydrochlorofluorocarbon (HCFC) solutions | kg | 1,000-5,000 |
| IV | Taxable plastic bags | kg | 30,000-50,000 |
| V | Pesticides restricted for use | kg | 500-2,000 |
| VI | Termiticides restricted for use | kg | 1,000-3,000 |
| VII | Wood preservatives restricted for use | kg | 1,000-3,000 |
| VIII | Warehouse disinfectants restricted for use | kg | 1,000-3,000 |
- Based on the Tax Bracket stipulated in Clause 1 Article 8 of the Law on Environmental Protection Tax 2010, the Standing Committee of the National Assembly stipulates specific tax rates for each taxable commodity ensuring the following principles:
+ The tax rate for taxable goods must be appropriate to the state’s socio-economic development policy in each period;
+ The tax rate for taxable goods is determined according to the level of adverse impact on the environment caused by the goods.
Therefore, the environmental protection tax rate for taxable plastic bags is 30,000 to 50,000 VND/kg.
>> Download List of environmentally protected activities eligible for incentives and support.
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