On the morning of October 17, the Central Institute for Economic Management (CIEM) announced a report assessing the impact of the draft Law on Special Consumption Tax (SCT), which stipulates the addition of sugary soft drinks according to Vietnamese standards with a sugar content of over 5g/100ml to the list of subjects subject to SCT.

The draft proposes to apply a tax rate of 10%.

According to CIEM, applying a 10% special consumption tax on sugary soft drinks will have a specific impact on the soft drink industry, such as shrinking production scale and decreasing production value.

Beverage businesses have proposed not to apply special consumption tax on sugary soft drinks because they have suffered consecutive "shocks" from the pandemic and unpredictable fluctuations in the economy in recent times.

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Overview of the workshop on the morning of October 17. Photo: Tien Anh

Ms. Chu Thi Van Anh, Vice President and General Secretary of the Vietnam Beer - Alcohol - Beverage Association (VBA), said that without a full impact assessment, VBA recommends considering not adding sugary soft drinks to the list of subjects subject to special consumption tax in this amendment.

Some businesses added that, if analyzed in depth, the amount of sugar that causes obesity does not come entirely from soft drinks. 5g/100ml cannot be the main cause of obesity. There are many other products on the market with high sugar content such as milk tea, candy, moon cakes... So should we tax them and is it fair?

Ms. Nguyen Thi Cuc, President of the Vietnam Tax Consulting Association, said that other sugary products are not taxed because their consumption is not as high as soft drinks. Vietnamese people are consuming more soft drinks, which is completely affecting their health and the environment.

According to Ms. Tran Thi Nhi Ha, Deputy Head of the Petition Committee (under the National Assembly Standing Committee), when proposing the idea of ​​imposing special consumption tax, there were many responses from public opinion and voters, however, she admitted that "Should we impose a tax or not?" is a difficult question to answer.

"Taxation is mainly to regulate consumer behavior and is applied to goods that have negative impacts on health and the environment. It is necessary to assess whether sugary soft drinks affect consumers' health or not, from which there is a basis for making a decision to apply tax to this item," Ms. Ha said.