The Ministry of Finance has put forth proposed adjustments to preferred import tariffs on goods that Vietnam does not encourage importing in order to realise the Government’s all-inclusive goals of curbing inflation, stabilising macro economy and ensuring social security. The adjustments are based on the list of import-discouraging items issued together with Decision No. 1380/QD-BCT dated March 25, 2011 by the Ministry of Industry and Trade to support domestic construction. These are also in line with WTO commitments.
According to the statistics from the General Department of Customs, Vietnam’s import and export turnover reached US$42.77 billion in the year to March 31, up 32.1 percent from the same period of last year. Specifically, exports were valued US$19.64 billion, up 36.4 percent, and imports were worth US$23.13 billion, up 28.6 percent. Thus, Vietnam still incurred a huge market deficit equivalent to 17.8 percent of exports. Petroleum products accounted for 18.5 percent, followed by machinery and equipment (9.6 percent) and clothing. Thus, it is very important to make adjustments to sort out imports and stimulate domestic production, an official from the General Department of Customs said.
After examining and comparing with WTO commitments applied to 2011, as many as 3406 tariff lines are equal to current ceiling rates committed to the WTO, 149 tariff lines are 1-3 percent lower than their ceiling rates, and 169 tariff lines are 4 percent or more lower than ceiling rates.
According to the Ministry of Finance, Vietnam cannot raise import duties on many import-discouraging goods because they are now equal to ceiling rates committed to the WTO. The ministry does not propose increasing tax rates on items which are 1-3 percent lower than their ceiling rates as the differential is not very large while this may complicate taxations. The ministry will not also adjust tax rates on 158 tax lines with rates 4 percent or more lower than their ceiling rates in case they are double-use (used as input materials for production and used for consumption) or they are not produced by Vietnam. Thus, 11 remaining tariff lines are expected to be adjusted.
Affected goods include shelled walnuts will be levied 30 percent of import tax from 20 percent (the WTO-committed rate is 30 percent), ketchups and other tomato sauces from 30 percent to 35 percent (Committed rate with the WTO is 35 percent) iron/steel tubs from 32 percent to 36 percent (WTO: 36 percent), inkjet printer from 0 percent to 5 percent (WTO: 5 percent), and filming tapes from 10 percent to 15 percent (WTO: 15 percent).
The ministry will raise tariffs on tobacco and tobacco-related products to 50 percent (WTO: 100 percent).
Speaking at a press conference, an official from the General Department of Customs also confirmed that tax hike will not be applied to goods that serve people’s life like agricultural and aquatic products (stayed at 0 percent). However, tax is still levied on products that Vietnam can produce abundantly like shrimps.
The ministry will also do not change tax rate on parboiled rice at 40 percent (WTO: 50 percent). As Vietnam is a rice-exporting nation (with annual exported volume of some 6 million tonnes), the importation of this product is not regarded as an element on the country’s trade deficit.
Vietnamese
