Finance ministry rejects Long Son Petrochemical proposal for higher import taxes

By Tri Duc
Thu, November 23, 2023 | 12:24 pm GMT+7

The Ministry of Finance has disagreed with a proposal by Long Son Petrochemicals (LSP), the investor of the $5.4-billion Long Son Petrochemicals Complex, to raise the most-favored nation (MFN) tax on some plastics products from 0% to 3%.

In a ministerial draft document sent for the government’s approval, LSP and its Thai parent firm Siam Cement Group (SCG) suggested a 3% MFN tax rate on imported polypropylene (PP) and polyethylene (PE) products, under HS codes 3902.90.90, 3901.10.92, 3901.20.00, and 3901.40.00.

A corner of Long Son Petrochemicals Complex in Ba Ria-Vung Tau province, southern Vietnam. Photo courtesy of Nguoi Lao Dong (Laborer) newspaper.

A corner of Long Son Petrochemicals Complex in Ba Ria-Vung Tau province, southern Vietnam. Photo courtesy of Nguoi Lao Dong (Laborer) newspaper.

The ministry clarified that per the investment certificate granted to LSP, some PP and PE products are already subject to 3% MFN tax, except for the ones under the four mentioned HS codes.

Vietnam currently import 1.2 million tons of PP and PE per year under MFN tax, including 600,000 tons for domestic consumption and 600,000 tons for export-oriented production that are not subject to import taxes.

LSP said its yearly output of 420,000-483,000 tons of PP and 525,000 tons of PE can meet domestic demand.

The finance ministry said the tax changes need serious consideration as they may negatively impact businesses that are not supplied by LSP and imports of such products from nations without free trade agreements (FTA) with Vietnam.

The ministry has proposed two solutions. First, the MFN tax can be set at 2%. That would fortify Vietnam’s support and incentive commitments to LSP as specified in its investment registration certificate and facilitate the development of domestic firms in the sector, it noted. However, the increase in tax revenue might be minimal as firms may adapt by importing from countries that hold FTAs with Vietnam, instead of Middle East nations.

The second solution is not to apply any changes as it would keep prices and supplies stable.

The finance ministry asked relevant sides to submit their opinions to the draft document by December 1, 2023.

Comments (0)
  • Read More
UAE tech firm G42, Vietnamese partners plan $2 bln hyperscale data center in southern Vietnam hub

UAE tech firm G42, Vietnamese partners plan $2 bln hyperscale data center in southern Vietnam hub

The United Arab Emirates's (UAE) state-backed firm G42 plans to partner with Vietnamese companies to develop a $2 billion hyperscale data center in Vietnam's southern hub Ho Chi Minh City.

Industries - Thu, July 10, 2025 | 4:22 pm GMT+7

Petrovietnam rakes in $19.5 bln in H1 revenue

Petrovietnam rakes in $19.5 bln in H1 revenue

State-owned Petrovietnam reported total revenue of VND510 trillion ($19.5 billion) in the first half of this year, driven by strong production performance.

Companies - Thu, July 10, 2025 | 4:03 pm GMT+7

Sustained momentum seen across all Vietnam's real estate sectors: Knight Frank

Sustained momentum seen across all Vietnam's real estate sectors: Knight Frank

Ho Chi Minh City and Hanoi saw solid office leasing and apartment market rebounds after the Lunar New Year holiday (Tet). Industrial land surged with record H1 supply and strong absorption, underscoring Vietnam's appeal, while eased visa policies and new direct international flights continue to support 5‑star hotels in both the cities, write Knight Frank analysts.

Real Estate - Thu, July 10, 2025 | 2:37 pm GMT+7

Vietnam's maritime heavyweight VIMC to expand container port services, bulk cargo transport

Vietnam's maritime heavyweight VIMC to expand container port services, bulk cargo transport

Vietnam Maritime Corporation (VIMC) will increase revenue and profit via expanding operations in areas such as container port services, bulk cargo transport, and shipping of agricultural products and steel, leveraging existing infrastructure and fleet advantages.

Companies - Thu, July 10, 2025 | 2:15 pm GMT+7

Vietnam infrastructure spending surges 40%

Vietnam infrastructure spending surges 40%

Vietnam’s infrastructure spending surged 40% year-on-year in the first half of the year, fuelled by fast-tracked approvals of projects amid provincial mergers; legal reforms granting provinces more decision-making authority over project approvals; and the streamlining of disbursement processes, write chief economist Michael Kokalari and senior analyst Thai Viet Trinh at VinaCapital.

Consulting - Thu, July 10, 2025 | 11:56 am GMT+7

Phu Quoc enters Travel + Leisure’s top luxury destinations

Phu Quoc enters Travel + Leisure’s top luxury destinations

Phu Quoc’s presence in Travel + Leisure’s Asia-Pacific luxury travel rankings continues to affirm the island’s status as a world-class destination.

Companies - Thu, July 10, 2025 | 11:43 am GMT+7

July dividend wave hits Vietnamese market following AGM season

July dividend wave hits Vietnamese market following AGM season

Ending the 2025 AGM season, a series of Vietnamese companies have announced dates for finalizing the list of shareholders eligible for dividends in July.

Finance - Thu, July 10, 2025 | 11:07 am GMT+7

Cordless technology leader TTI plans to expand manufacturing in southern Vietnam

Cordless technology leader TTI plans to expand manufacturing in southern Vietnam

Germany's Techtronic Industries Company Limited (TTI), a world leader in power tools and outdoor power equipment, wants to expand its Milwaukee plant in Ho Chi Minh City.

Industries - Thu, July 10, 2025 | 8:58 am GMT+7

Vietnam pledges support for AES investment in green energy

Vietnam pledges support for AES investment in green energy

Vietnam will continue to facilitate foreign investment and business activities, including those by U.S. enterprises, in line with laws and the country’s evolving development needs, said Tran Luu Quang, Chairman of the Party Central Committee’s Commission for Policies and Strategies.

Companies - Wed, July 9, 2025 | 11:10 pm GMT+7

Tezuka Daisuke appointed as new general director of Aeon Vietnam

Tezuka Daisuke appointed as new general director of Aeon Vietnam

Aeon Group has appointed Tezuka Daisuke, who is in charge of its organization reform for fiscal year 2025, as general director of Aeon Vietnam Co., Ltd.

Companies - Wed, July 9, 2025 | 11:03 pm GMT+7

Vietnam mobilizes over $7 bln for Just Energy Transition

Vietnam mobilizes over $7 bln for Just Energy Transition

Vietnam has so far mobilized more than $7 billion for its Just Energy Transition agenda under the Political Declaration on the Just Energy Transition Partnership (JETP).

Companies - Wed, July 9, 2025 | 10:38 pm GMT+7

Thailand hopes to conclude US trade talks before new deadline

Thailand hopes to conclude US trade talks before new deadline

Thailand is optimistic that it can finalize a trade deal with the U.S. before the August 1 deadline to avoid a 36% tariff imposed by President Donald Trump, according to Finance Minister Pichai Chunhavajira.

Southeast Asia - Wed, July 9, 2025 | 10:34 pm GMT+7

Southeast Asia seeks additional tariff negotiations with US

Southeast Asia seeks additional tariff negotiations with US

Southeast Asia's biggest economies are preparing to intensify trade negotiations with the U.S. after being subjected to steep tariff rates, despite having made a series of last-minute proposals aimed at increasing imports and significantly reducing tariffs on U.S. goods.

Southeast Asia - Wed, July 9, 2025 | 10:31 pm GMT+7

Foreign capital massively flows into banking, securities stocks

Foreign capital massively flows into banking, securities stocks

Foreign investors net bought for the sixth consecutive session on the Vietnamese stock market Wednesday, to the tune of nearly VND2,000 billion ($76.5 million), focusing on banking and securities stocks.

Finance - Wed, July 9, 2025 | 10:17 pm GMT+7

Four new container terminals to be built in northern Vietnam economic hub

Four new container terminals to be built in northern Vietnam economic hub

Prime Minister Pham Minh Chinh has granted in-principle approval for the development of four new container terminals at Lach Huyen Port in the northern city of Hai Phong.

Infrastructure - Wed, July 9, 2025 | 5:36 pm GMT+7

Sausage mogul eyes $5 bln green energy, cattle project in northern Vietnam

Sausage mogul eyes $5 bln green energy, cattle project in northern Vietnam

Mai Huy Tan, who founded and later sold the popular Duc Viet sausage brand, has proposed a $5 billion circular economy complex in Quang Ninh province, northern Vietnam.

Industries - Wed, July 9, 2025 | 5:14 pm GMT+7