HANOI: The Ministry of Finance has proposed an adjustment to import and export tax rates for some groups of goods from January 1, 2016. The adjustment is in line with the Standing Committee of the National Assembly’s tax rate framework and Viet Nam’s commitments to the World Trade Organisation (WTO).
At present, the ministry is collecting opinions from other ministries, associations and enterprises on the draft of a new circular on adjusting import and export tariffs, which will replace Circular 164/2013/TT-BTC.
Under the draft, the ministry will lower nine import tariff lines for fish and auto products, with rates of between 1 per cent and 3 per cent, based on Viet Nam’s commitments upon becoming a WTO member. In addition, the ministry will adjust the preferential rates of import and export taxes for 10 groups of goods, the Thoi bao Tai chinh newspaper reported.
Regarding export tariffs, the ministry plans to increase preferential rates for raw materials instead of finished products to limit the export of materials and retain them for domestic production instead. The increase in export tax rates is also aimed at reducing the number of trade fraud cases.
For instance, the export tax rate will surge from 10 per cent to 30 per cent for rare-earth ores and from zero to 20 per cent for slag collected from metallurgical processes.
The new export tax rates will also increase from between zero and 5 per cent to between 10 per cent and 22 per cent for some commodities, including wooden chips, wood used as raw material for wooden products, aluminium, manganese slag and zinc scrap.
Meanwhile, the ministry will lower the preferential rates on import tariffs for some production materials, including a dip from 3 per cent to zero for blocks of yellow limestone and marble and from 40 per cent to 30 per cent for extracts, essences and condensed products made from coffee and tea.
However, the preferential rates on import tariffs will increase to limit imports of certain items, including fibre made from polyester (up from zero to 3 per cent) and animal feed (up from zero to 2 per cent).
The industry and trade ministry (MOIT) has set an export turnover target of US$181.5 billion for 2016, a 10 per cent increase compared with 2015. The growth rate has been set in the ministry’s report on development targets for industrial production and trade activities in 2016.
In the first eight months of this year, the export turnover touched $106.3 billion, which was lowered than expected due to a strong decrease in the demand for agricultural, seafood and mineral products.
The foreign direct investment (FDI) sector has been the main momentum for growth, with an export turnover of $74.6 billion, up 14.7 per cent, while Vietnamese firms contributed $31.7 billion, down 2.3 per cent. These figures show that local firms still face difficulties.
The ministry said the country should continue to promote market expansion and exports to achieve the target set for 2016. MOIT will focus on diversifying markets to reduce the risks from depending on some markets, while continuing the negotiations to penetrate new markets. Vietnamese agricultural and seafood products will need tax reduction and the removal of unnecessary trade and technical barriers to get favourable conditions for exports.
The ministry will raise awareness on the signed free trade agreements in specific sectors. In addition, it will provide information about the negotiations on other FTAs to help businesses take advantage of the opportunities for higher export turnover. It said the relevant agencies should implement administrative reforms and improve the business environment to facilitate firms’ production, trade and exports.
Exporters have been asked to actively co-operate with associations as well as large firms in the processing sector and FDI companies to exchange information on exports. This could help to quickly resolve the difficulties faced by domestic businesses. The ministry had earlier set an export target of $160.3 billion for 2015.
