Tax on imported sugar to remain at 5%

A woman shops for sugar at supermarket. — Photo nld.com.vn

The tax on imported sugar, as stipulated by the ASEAN Trade in Goods Agreement (ATIGA), will be maintained at 5 per cent from the beginning of this year, instead of zero per cent as previously rumoured.

This was announced in Decree 156/2017/NĐ-CP, stipulating Việt Nam’s special preferential import taxes in ATIGA for the 2018-22 period.

According to the Việt Nam Sugar and Sugarcane Association (VSSA), this was a good sign for the local sugar industry, as they would face difficulties if the tax was lowered to zero per cent.

The association said that the price of shares of some sugar companies in 2017 were continuously falling, mainly because producers were afraid of competition from sugar importers if the zero per cent tax had been actually imposed on imported sugar.

VSSA’s figures indicated that the wholesale price of sugar last month was VNĐ12,700-14,000 per kilo, a decline of VNĐ200-300 per kilo over the previous month.

By maintaining the 5 per cent import tax under ATIGA, together with abundant sugar supplies and lower selling prices, local businesses would not import sugar from other countries.

By the end of last year, sugar inventories were some 240,000 tonnes.

VSSA said the sugar supply would meet the country’s demand in the first month of 2018, even with increased sales during the upcoming Tết (Lunar New Year) Holiday.

Sugarcane is cultivated on more than 300,000ha across the country, employing 330,000 households, or 1.5 million farmers, and 350,000 workers.