What is the purpose of developing a roadmap for increase in taxes on tobacco, beer and alcohol products in Vietnam?

What is the purpose of developing a roadmap for increase in taxes on tobacco, beer and alcohol products in Vietnam?

According to point b, clause 1, Section 3, Article 1 of Decision 508/QD-TTg of 2022:

III. SOLUTIONS FOR IMPLEMENTING THE STRATEGY

1. Regarding tax policy reform

...

b) For excise tax: review, research, amend, and supplement the list of goods subject to excise tax to regulate consumption in line with social consumption trends and the direction of the Communist Party and the State on protecting public health and the environment; develop a roadmap to adjust and increase taxes on tobacco, beer, and alcohol products to limit production and consumption and fulfill international commitments; review and adjust the excise tax levels on certain items to suit the socio-economic conditions of the 2021-2030 period; research the application of a combination of proportional tax rates and absolute tax levels for certain goods and services subject to excise tax;

...

Accordingly, the solution for implementing the strategy of reforming excise tax policy according to the tax system reform strategy until 2030 is as follows:

- Review, research, amend, and supplement the list of goods subject to excise tax to regulate consumption in line with social consumption trends and the direction of the Communist Party and the State on protecting public health and the environment;

- Develop a roadmap to adjust and increase taxes on tobacco, beer, and alcohol products to limit production and consumption and fulfill international commitments;

- Review and adjust the excise tax levels on certain items to suit the socio-economic conditions of the 2021-2030 period;

- Research the application of a combination of proportional tax rates and absolute tax levels for certain goods and services subject to excise tax.

Thus, when implementing the strategy of reforming the excise tax policy according to the tax system reform strategy until 2030, a roadmap will be developed to adjust and increase taxes on tobacco, beer, and alcohol products to limit production, consumption, and fulfill international commitments.

What is the purpose of developing a roadmap for increase in taxes on tobacco, beer and alcohol products in Vietnam? (Image from the Internet)

What are the current excise tax rates for tobacco, beer and alcohol products in Vietnam?

According to Article 7 of the excise tax Law 2008 (amended by clause 4, Article 1 of the Amended excise tax Law 2014), the excise tax rates on goods and services are specified according to the excise tax tariff.

The excise tax tariff for beer and alcohol products is specified as follows:

excise tax TARIFF

From the tariff above, it can be seen that the current excise tax rates for beer and alcohol products are:

(1) Cigarettes, cigars, and other tobacco products: Tax rate of 75%.

(2) Alcohol of 20 degrees or more: Tax rate of 65%.

(3) Alcohol under 20 degrees: Tax rate of 35%.

(4) Beer: Tax rate of 65%.

What are cases where it is not required to declare, calculate, and pay value-added tax in Vietnam?

According to clause 3, Article 2 of Decree 209/2013/ND-CP, the cases not required to declare, calculate, and pay value-added tax include:

- Organizations and individuals receiving compensations, bonuses, supports, emission rights transfers, and other financial incomes.

- Organizations and individuals producing and trading in Vietnam purchasing services from foreign organizations with no permanent establishment in Vietnam, and foreign individuals who are non-residents in Vietnam, including cases such as:

+ Repair of transportation means, machinery, equipment (including supplies and spare parts); advertising, marketing;

+ Investment and trade promotion;

+ Brokerage of goods sales, service provision;

+ Training; allocation of international postal and telecommunications charges between Vietnam and foreign countries where such services are provided outside Vietnam.

- Organizations and individuals not engaged in business, not VAT payers, selling their assets.

- Organizations and individuals transferring investment projects for the production and business of VAT-liable goods and services to enterprises and cooperatives.

- Agricultural, breeding, and aquaculture products that have not been processed into other products or have only been through preliminary processing and are sold to enterprises and cooperatives, except as stipulated in clause 1, Article 5 of the VAT Law 2008.