Tobacco smuggling in Vietnam tends to decline

	Tobacco smuggling on the southwest border remains complicated
	Smoking kills more than 40,000 every year in Vietnam
	Ministry proposes tobacco tax increase to VND2,000

Ms. Hana Ross

As one of the leading international experts on methods of measuring tobacco smuggling, what are the methods of measuring tobacco smuggling and appropriate methods for Vietnam?

There are many methods for measuring tobacco smuggling. In my opinion, the most appropriate methods for Vietnam is to conduct surveys to consumers and ask them what kind of tobacco they are using, how many and how much they pay? Many surveys on tobacco smuggling have been conducted in Vietnam and I think that these surveys have been done well.

Another method is to focus on monitoring the amount of smuggled tobacco over the time, for example, the difference between smuggled tobacco and legal tobacco. This method must be conducted for many years. Of course, Vietnam has implemented, but the accuracy must be monitored over many years for measuring.

Some opinions said that the tobacco tax increase will raise the tobacco smuggling. How do you think about these opinions?

The tobacco tax increase does not lead to raise smuggling, because tobacco is mainly transported from abroad into Vietnam. However, when amending tax structure to transfer into specific tax, it can lead to some companies manufacturing tobacco in Vietnam evading tax. Therefore, when applying new tax structures, the State agencies need to take measures to control these companies.

How do you analyze and assess about the relationship between tobacco tax policies and tobacco smuggling in Vietnam?

Currently, according to survey data, the smuggling in Vietnam is not a big problem. Our latest data shows that the smuggling in Vietnam tends to decline, thus creating a chance for Vietnam to increase tax. But if smuggling is better controlled with administrative aspects, it may create positive benefits, because when Vietnam controls tobacco well it raises revenues for the budget.

What do you recommend or propose to the Vietnam Government to prevent the impact of tobacco in general and continue to improve tax policies in particular as well as measures for anti-smuggling?

The amendment of Vietnam’s tax structure is done well. If transferring into specific tax, it is easy to control the production volume as well as taxable volume, because we can count them. This is the advantage of amendment of the tax structure in Vietnam.

When mentioning smuggling, we need to talk about origin of illegal tobaccos in some areas. Zet and Hero are the most common smuggled tobacco types which is concentrated in the southern provinces. Hence, the Vietnam Government needs to take measures to control well and focus on these provinces to control smuggled cigarettes at the border in the southern area. Of course, it is very difficult, but if we make an effort we will achieve success.

Need to handle the right ringleaders for tobacco smuggling VCN- The Deputy Prime Minister, Mr. Truong Hoa Binh, Head of the National Steering Committee 389 has ...

Currently, Ministry of Finance is drafting to amend and supplement the Law on Special Consumption Tax. In the Draft, the Ministry has proposed to apply specific tax to domestically manufactured and imported tobacco besides the current tax rate. What is your opinion on this proposal?

The proposal by the Ministry of Finance on supplementing the specific tax to change tax structure is excellent, because this structure is being used in the world. However, the specific tax rate should be high enough to impact the users, as high as possible.

Thank you, Madam!