Vietnam should phase out tax levy on sugary drinks: US-ASEAN Business Council

Vietnam should phase out any excise tax impositions on sugary and alcoholic drinks, the US-ASEAN Business Council (USABC) suggested.

A USABC delegation made the recommendation at a Wednesday meeting with Vu Hong Thanh, Vice Chairman of the National Assembly, Vietnam’s highest legislative body.

The delegation also raised other recommendations related to investment procedures for energy projects, aviation cooperation, birthrate, innovation and science-technology development, capital market, logistics investments, and private data protection.

In reply, Thanh said the suggestions would be sent to relevant agencies for consideration. Improving the investment climate is a priority of Vietnam and the National Assembly will further focus on updating the legal framework, he added.

Thanh also called on American businesses to further collaborate with Vietnam, especially in science-technology, innovation, and digitalization.

Last week, the National Assembly’s Economic and Financial Committee suggested that Vietnam should postpone the imposition of a 10% excise tax on sugary drinks by one or two years from the scheduled timeline.

The Ministry of Finance is currently working on the amended draft Excise Tax Law, which is set for a vote in May 2025.

At an excise tax workshop in early March, Prof. Nguyen Mai, chairman of the Vietnam’s Association of Foreign Invested Enterprises (VAFIE), recommended authorities not levy the tax on sugary drinks.

In case the National Assembly insists on passing the law with tax on sugary drinks, the tax should be phased out for businesses to adapt to the situation, Mai added.