On 18 March, 2025, the Vietnam Chamber of Commerce and Industry (VCCI) hosted the Consultation Workshop to complete the draft Law on Special Consumption Tax (SCT). Participating in the workshop were representatives of business associations and business communities.
Representing EuroCham were Wine and Spirit Sector Committee (WSSC) member – Ms. Huynh Thi Thanh Truc. The workshop also welcomed distinguished guests including:
- Mr. Dau Anh Tuan – Vice Secretary-General cum Director of the Legal Department of the Vietnam Chamber of Commerce and Industry (VCCI)
- Dr. Can Van Luc – Chief Economist of BIDV and Director of BIDV Training and Research Institute
- Assoc. Prof. Dr. Nguyen Van Viet – Chairman of Vietnam Beer, Alcohol and Beverage Association (VBA)
- Mr. Nguyen Chi Nhan – General Secretary of Vietnam Tobacco Association (VTA)
- and Mr. Dao Cong Quyet – Head of Communications Subcommittee, Vietnam Automobile Manufacturers Association (VAMA)
Market Insights from Vietnam Beer-Alcohol-Beverage Association
Chairman of the Vietnam Beer-Alcohol-Beverage Association (VBA) shared that one of the key economic growth objectives is to boost consumption and develop the domestic market. However, the Special Consumption Tax aims to reduce consumption, which could hinder the industry’s recovery and weaken efforts to stimulate spending for economic growth.
Therefore, before proposing any tax adjustments, it is crucial to conduct an in-depth study on factors such as balance, budget impact, consumption, and employment. Policy makers should also consider the effectiveness, efficiency, and fairness of the tax policy. In addition to presenting business and industry recommendations supporting tax deferral, Mr. Việt suggested that the drafting committee could explore multiple tax adjustment options.
EuroCham Advocates for Suitable Tax Roadmap: Balancing Economic Growth and Public Health Protection
With the current Special Consumption Tax (SCT) on wine of 35% and on spirits of 65%, EuroCham’s WSSC members raised concerns that the proposed “shock” increases in the draft law (wine to 70% and spirits to 100% by 2030) will have a negative impact on public health. This is because consumers will tend to shift to unrecorded products which currently estimated to account of 63% of total consumption. These unrecorded products are untaxed and of questionable quality. Imposing high taxes will also create a cost burden for businesses, negatively affecting related sectors such as manufacturing, tourism, F&B, and employment in the supply chain.
Additionally, under the EVFTA, Vietnam pledged to remove import tariffs for wine and spirits after seven years and beer after ten years, beginning from August 2020. The country also committed to demonstrate no preferential treatment in terms of import tax. The current SCT proposal would nullify EVFTA’s elimination of customs duties for trade benefits.
In response, and building on our advocacy efforts, WSSC proposed a more balanced tax roadmap, including: (1) an effective date starting in 2028, (2) a maximum increase of 5% every 2-3 years, and (3) a consideration to explore an alternative tax calculation method that align with the objective of revenue collection, business development, and public health protection.
EuroCham continues bridging the business community and policy makers to foster a sustainable business landscape in Vietnam.
