This morning, National Assembly Television held a discussion focusing on the issue of increasing special consumption tax on tobacco, one of the important solutions to realize the goal of the National Strategy on Tobacco Harm Prevention by 2030.
According to experts and delegates, increasing tobacco taxes is an effective measure to reduce consumption, especially among low-income groups. When product prices increase, consumers will tend to limit their tobacco purchases, thereby reducing the burden of disease on society.
At the seminar, representatives of the World Health Organization (WHO) shared the experiences of many countries in the world in applying special consumption tax on tobacco. Accordingly, increasing high and stable tax is one of the important factors to help reduce tobacco consumption effectively.
Dr. Angela Pratt, WHO representative, said: One of the reasons for the high smoking rate among Vietnamese men (up to over 40%) is because the price of cigarettes is extremely cheap and the reason is because of very low taxes. And when incomes increase but cigarette prices do not keep up, over time the price of cigarettes becomes cheaper and more affordable.
Meanwhile, tobacco taxes in Vietnam are also among the lowest in the ASEAN region.
Ms. Angela Pratt said that Vietnam has made some encouraging initial progress in the fight against tobacco harms over the past decade. “ However, we need to take stronger action – through higher taxes – to achieve the Government’s targets on reducing smoking, which will protect health and save lives.
Imposing higher tobacco taxes will protect Vietnam’s most precious resource, the health of its people, and will thereby help realise the nation’s aspiration for a healthier and more prosperous future ,” she said.
Dr. Angela Pratt, WHO representative at the seminar.
Based on international experience, experts recommend that Vietnam should apply a higher tax rate than the current proposal of the Ministry of Finance. At the same time, measures should be taken to prevent smuggling and ensure effective tax collection.
Need a synchronized solution
Although agreeing with the increase in excise tax on tobacco, the speakers also pointed out that tax increase is only part of the overall solution. To achieve the goal of reducing smoking rates according to the strategy's roadmap, there needs to be synchronous coordination between ministries and sectors, especially strengthening communication, health education, and tightening market management.
In addition, increasing tobacco taxes also poses many challenges, especially in economic terms. Some opinions fear that increasing taxes too high could lead to tobacco smuggling, causing budget losses and making it difficult to control product quality.
Dr. Nguyen Huy Quang, former Director of the Legal Department (Ministry of Health), Head of the Consulting, Criticism and Social Appraisal Board of the Vietnam Medical Association, said that based on scientific and social grounds, we need to evaluate the special consumption tax on tobacco products, to see what is in the interests of the State, what is in the interests of society, and what is in the interests of businesses.
“ Between economic benefits and health benefits, do we focus on health benefits or economic benefits? If the State vision is a State of the people, by the people, for the people, then we must develop these benefits in parallel. But in terms of social security policies, people-centered, people's health must still be put first,” he shared.
He also added that the Draft on special consumption tax on tobacco products has very progressive points, that is, we impose a relative tax on tobacco/the price of the manufacturer or importer at 75%. We also have a mixed tax with the highest rate of 10,000 VND from now until 2030. The Ministry of Health proposed this rate to be 15,000 VND. Only then can we achieve the national target of 36% tobacco prevention.
Economists believe that a reasonable tax increase will bring many long-term benefits, not only for public health but also for the state budget. In addition, using tax revenue to invest in tobacco harm prevention programs will help reduce social health costs.
Experts say that imposing high excise taxes on tobacco products is the most effective measure to reduce the harmful effects of tobacco.
Recently, in the Draft Law on Special Consumption Tax being revised and being consulted, the Ministry of Finance proposed to increase the consumption tax on cigarettes with 2 options:
Option 1: In 2026, the tax rate remains at 75% and an additional VND2,000/bag is added. From 2027 to 2030, the tax will increase by VND2,000/bag each year. By 2030, the absolute tax rate will be VND10,000/bag.
Option 2: In 2026, when the revised Law on Special Consumption Tax officially takes effect, along with maintaining the current tax rate of 75% on the selling price, the absolute tax rate on cigarettes is 5,000 VND/pack.
Each year after that, the tax will increase by 1,000 VND/bag. By 2030, the tax will increase to 10,000 VND/bag.
To reduce cigarette consumption, the Ministry of Finance is leaning towards option 2.
Source: https://vtcnews.vn/tang-thue-tieu-thu-dac-biet-voi-thuoc-la-chuyen-gia-phan-tich-gi-ar902543.html
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