Minister of Finance: It is impossible not to collect special consumption tax on gasoline

On May 9, discussing the draft revised Law on Special Consumption Tax (SCT), the opinions of National Assembly deputies were still different on many taxable items.

Minister of Finance : It is impossible not to collect special consumption tax on gasoline. Photo: QUANG PHUC

Explaining to the National Assembly , Minister of Finance Nguyen Van Thang said that with this draft law, during the policy development process, the drafting agency received many opinions.

Tax on sugary drinks: Should have been collected sooner

For example, regarding the inclusion of sugary soft drinks under the special consumption tax, Minister of Finance Nguyen Van Thang said that there are two opinions on this issue. Some are concerned about whether it is necessary to tax them, while others are asking for taxes to be imposed as quickly and as much as possible, such as the Consumer Protection Association, international organizations, especially the World Health Organization.

Recently, there have been clear grounds for considering taxing soft drinks according to Vietnam Standards with sugar content above 5g/100ml. The World Health Organization has issued a detailed and specific report on countries, in which it recommends that Vietnam is one of the countries that consumes more and more sugary drinks, leading to the risk of obesity. The Ministry of Health's report also clearly states this situation. Therefore, the World Health Organization recommends that all countries, including Vietnam, must apply a minimum of 20% special consumption tax.

In fact, in the world today, 107 countries have imposed special consumption tax on this item, and in the ASEAN region, 7/11 countries have imposed tax.

Minister of Finance Nguyen Van Thang spoke to explain and clarify a number of issues raised by National Assembly deputies on the morning of May 9. Photo: QUANG PHUC

Based on world practice and Vietnam's reality, according to the Minister, it should have been taxed earlier, but now it is too late to tax, "we cannot let our children become obese and sick before discussing it". According to the Minister, the drafting agency and the reviewing agency have accepted the tax rate and time in the direction of extending the application period, reducing the rate to 8% in 2027 and 10% in 2028.

The Minister added that according to the national standards on soft drinks announced by the Ministry of Science and Technology, soft drinks are ready-to-drink products for the purpose of quenching thirst, made from water and may contain sugar, food additives, flavorings, and may contain added natural ingredients, vitamins and minerals, carbonated or non-carbonated.

Accordingly, the types of drinks that are not subject to special excise tax include: milk and dairy products, liquid foods used for nutritional purposes, natural mineral water, bottled water, pure fruit and vegetable juice, cocoa products... Therefore, the products that National Assembly deputies are interested in, typically coconut water, will not be subject to tax.

Regarding taxation on air conditioners, the Minister said that currently, a few countries impose special consumption tax on air conditioners for two reasons: related to energy saving and related to refrigerants that are harmful to the environment and the ozone layer.

In response to the opinions of National Assembly delegates, the draft law stipulates that no tax will be collected on air conditioners with a capacity of less than 18,000 BTU and over 90,000 BTU. Some delegates suggested raising this capacity, the Minister affirmed that he would accept it for further research, possibly raising the level from over 24,000 BTU to 90,000 BTU to be subject to tax.

“The Prime Minister has made very specific decisions, requiring that by 2045, we limit and not produce or import household air conditioners, air conditioners, and whole sets using HCFCs and HFCs. These are heating agents that affect the ozone layer. Therefore, the special consumption tax on air conditioners needs attention. In addition, currently, electricity consumption is not encouraged, the more you consume, the higher the price,” the Minister said.

Discussion session on May 9. Photo: QUANG PHUC

Research on special tax collection on plastic and nylon

Regarding the special consumption tax on gasoline, the Minister informed that the tax on gasoline has been applied since 1998. Recently, the Prime Minister committed at COP 26 to reduce emissions to zero by 2050, which is a difficult goal. European countries have implemented it very strongly, Vietnam must also make efforts, having made such a commitment, it is even more impossible not to collect special consumption tax on gasoline.

Regarding the proposal to collect special consumption tax on plastic products and nylon bags, the Minister would like to accept and continue to review; currently, the maximum environmental protection tax has been levied on this product, and will continue to study whether to continue to collect special consumption tax.

Regarding the application deadline for all items, the drafting and reviewing agencies will continue to review which items will be applied from 2026 and which items will be delayed until 2027 to both achieve the National Assembly's goals and at the same time avoid shocks to businesses.

LAM NGUYEN

Source: https://www.sggp.org.vn/bo-truong-bo-tai-chinh-khong-the-khong-thu-thue-tieu-thu-dac-biet-voi-xang-post794467.html