The HCMC People’s Committee believes that mobile phones must bear a luxury tax or special consumption tax (SCT) as it is called in Vietnam.
While the taxation agency insists on imposing a luxury tax on soft drinks, some experts warn that the move could lead to Vietnam being accused of discriminatory treatment.
A series of international brands have been pouring more money into Vietnam’s high-potential soft drink segment, toughening up competition against fledgling domestic producers.
Wishing to cash in on Vietnam’s skyrocketing demand for drinks, French beverage firms have asked local authorities to ease special consumption tax lines, which they find to be too high and contrary to the country’s commitments of reducing taxes for beverages under the EU-Vietnam Free Trade Agreement.
The Vietnam Beer Alcohol Beverage Association (VBA) has requested the Ministry of Finance (MoF) to withdraw its proposal to apply a special consumption tax (SCT) of 10% or 20% on soft drinks due to a lack of practical considerations and the state budget.