Dairy firms may not pay extra taxes for AMF imports

In a document recently sent to the Prime Minister, the ministry admitted the plan to collect the additional value-added and import taxes from importers, producers and traders of AMF is groundless.

The ministry sent the Prime Minister the document after the dairy firms had submitted a petition to the Government leader and the Minister of Finance in late November to oppose the customs decision to tax AMF imports at 15% and collecting an extra VND700 billion from them in the 2010-2015 period.

According to the dairy firms, AMF and Anhydrous Butterfat (ABF) are actually similar and subject to the same import duty of 5%. They have many times worked with the General Department of Customs, which agreed the 5% rate.

The Ministry of Finance has reported to the Government, proposing the 5% tariff for AMF imports.

The ministry said it had consulted the ministries of industry-trade and health, looked into the case and found the basic ingredients of the two products were identical. The two products are only different in peroxide value, input ingredients and the use of additives in the production process.

The Ministry of Finance said the existing regulation on AMF import tax is irrational and not transparent as products with similar ingredients are subject to different tax rates. Besides, the tariff for AMF, which is a production material, is high compared to the rates of 5-7% on imported milk products and the 10% rate on imported yogurt. 

Therefore, the ministry sought the Government’s nod to impose a 5% tariff on AMF import as declared by importers. The final decision will rest with the Prime Minister.

Before the Ministry of Finance wrote to the Government, provincial customs departments had already stopped collecting the extra value-added and import taxes on AMF imports as required by the ministry.