The Vietnam Association of Financial Investors (VAFI) has just sent an official document to the Prime Minister, the Ministry of Finance and the Ministry of Justice to provide comments on the Draft Law on Special Consumption Tax. In this document, VAFI supports the policy of the Party, the Government and the National Assembly on increasing special consumption tax so that the selling price of beer products increases by at least 10% as recommended by WHO to protect people's health and regulate budget revenue. However, VAFI also emphasizes the view that the tax increase must ensure a transparent and fair competitive environment for all businesses in the beer industry.
The increase in Special Consumption Tax according to the roadmap affects business operations but for the common good of the country.
VAFI said it has received the Ministry of Finance's Proposal to develop the Law on Special Consumption Tax and the Government's Resolution 115 dated July 28, 2023. Accordingly, there are 2 options for adjusting the increase in Special Consumption Tax:
- Option 01 is to maintain the current tax calculation method and increase the Special Consumption Tax rate according to a roadmap in line with WHO recommendations;
- Option 02 is to increase tax by applying a mixed tax calculation method (applying both relative tax according to percentage rate and adding an absolute tax rate for alcohol and beer).
With these 2 options, the drafting agency, the Ministry of Finance, proposed to choose Option 01 with the reason to ensure the competitive factor in the context of the difference in quality and price of alcoholic beverages and also to ensure budget revenue. VAFI agrees with the Ministry of Finance on this choice.
According to VAFI's calculations with 06 scenarios with 06 absolute tax rates from high to low corresponding to the weighted average prices from high to low of existing beer products on the Vietnamese market, all 06 scenarios given are:
Heineken is the company that will always have the lowest actual tax rate because Heineken's selling price is much higher than all other companies. According to VAFI's calculations, Heineken will be the company that benefits the most from the addition of the absolute tax rate, and the more Heineken benefits, the more other companies in the industry will suffer, even going bankrupt. Therefore, VAFI affirms that the plan to add an absolute tax rate on alcohol and beer is inappropriate, unfeasible and does not create equality and fairness among businesses. On the contrary, it creates a competitive advantage and unique incentives for Heineken.
At the end of the document sent to the Prime Minister, VAFI also stated that the idea of changing the mixed tax calculation method by adding the above-mentioned absolute tax rate is contrary to the provisions of Articles 6 and 8 of the Competition Law 2018 and seriously affects national interests (while only bringing advantages to a dominant enterprise in the market).
Enterprises in general and alcohol enterprises in particular have been facing many difficulties, from the impact of the Covid-19 pandemic and now the deflation of the domestic and foreign economies. At this time, although clearly aware of the negative impact of the planned increase in Special Consumption Tax on business operations, for the common good of the country and the health of Vietnamese people, business leaders agree with this policy. However, they also have a legitimate desire to be treated equally and fairly for all businesses in the industry. Do not, for any motive or reason, create an advantage for one business to monopolize the market, destroying legitimate competition in Vietnam./.
According to Tuoitrethudo.com.vn
Source
Comment (0)