Volunteers join a campaign against the use of tobacco in central Da Nang city (Photo: VNA) Hanoi (VNS/VNA) - The new cigarette tax rate of5,000 VND (0.2 USD) per pack will help reduce the rate of tobacco consumptionand increase the State budget, health experts have said.
Speaking at the conference on tax incentives to preventtobacco harm on September 25 morning, health experts said the application ofthe special consumption tax rate will reduce the tobacco use rate among menfrom 45.3 percent to 39 percent by 2020.
Currently, Vietnam has the world’s ninth-highest number ofsmokers. On average, one in every two male adults is smoker. The prevalence ofsmoking among adolescents is 24.3 percent.
The country has been suffering the burden of disease andfinancial loss caused by tobacco use. In 2015, Vietnamese people spent up to 31trillion VND (1.3 billion USD) on cigarettes and more 24 trillion VND (1.03billion USD) on treatment of tobacco-related diseases such as lung cancer,respiratory and cardiovascular diseases, stroke and heart attack.
More than 40,000 tobacco-related deaths are reported eachyear in Vietnam, and the number is estimated to increase to 70,000 by 2030, theWorld Health Organisation (WHO) has said.
Nguyen Tuan Lam, a WHO expert, said the tariff rate on thecigarette retail price in Vietnam was about 36 percent, much lower than that inother countries in the region, such as 73 percent in Thailand, 66 percent inSingapore, 62 percent in Brunei and the level of 70 percent recommended by theWHO.
Due to the low tariff, Vietnam has a low retail price ofcigarettes, he said.
Lam said the Ministry of Finance’s proposal on applying theabsolute tax rate of 1,000 VND (0.04 USD) per cigarette pack and 15,000 VND percigar since early January, 2020 would help reduce the rate of smokers byonly 1.5 percentage points and bring more than 3.9 billion VND (167,700 USD) tothe State budget.
However, he said, to achieve the national target on reducingthe rate of tobacco use by 6.3 percentage points by 2020, the absolute tax rateshould be 5,000 VND per pack. This would also bring 10.7 trillion VND (460million USD) to the State budget.
Do Thi Phi, a representative from the Centre for Research andCommunity Development Services, said the results from a public surveyimplemented in Hanoi and HCM City this January showed that the proposal onincreasing the special consumption tax rate on cigarettes received support from94 percent of participants.
Another survey implemented by the University of Commerce andHealthBridge Canada among 600 adolescents showed that 76.2 percent said thetobacco price was cheap and 83.5 percent agreed the tax on tobacco should beincreased.
PhD Nguyen Ngoc Anh, director of the Development and PoliciesResearch Centre, said many tobacco producers said the tax increase ondomestic-produced tobacco would increase the smuggling of tobacco.
This assumption was not accurate as the price of smuggledtobacco was much higher than the domestic-produced products, he said. Theconsumption of smuggled tobacco is all about consumers’ taste, not about theprices. He cited imported cigarette Jet as an example. The branch occupied 83.6percent of the market last year, and its price was much higher than that of thedomestic branches.
The conference was jointly held by the Ministry ofInformation and Communications and HealthBridge Canada.-VNS/VNA
Speaking at the conference on tax incentives to preventtobacco harm on September 25 morning, health experts said the application ofthe special consumption tax rate will reduce the tobacco use rate among menfrom 45.3 percent to 39 percent by 2020.
Currently, Vietnam has the world’s ninth-highest number ofsmokers. On average, one in every two male adults is smoker. The prevalence ofsmoking among adolescents is 24.3 percent.
The country has been suffering the burden of disease andfinancial loss caused by tobacco use. In 2015, Vietnamese people spent up to 31trillion VND (1.3 billion USD) on cigarettes and more 24 trillion VND (1.03billion USD) on treatment of tobacco-related diseases such as lung cancer,respiratory and cardiovascular diseases, stroke and heart attack.
More than 40,000 tobacco-related deaths are reported eachyear in Vietnam, and the number is estimated to increase to 70,000 by 2030, theWorld Health Organisation (WHO) has said.
Nguyen Tuan Lam, a WHO expert, said the tariff rate on thecigarette retail price in Vietnam was about 36 percent, much lower than that inother countries in the region, such as 73 percent in Thailand, 66 percent inSingapore, 62 percent in Brunei and the level of 70 percent recommended by theWHO.
Due to the low tariff, Vietnam has a low retail price ofcigarettes, he said.
Lam said the Ministry of Finance’s proposal on applying theabsolute tax rate of 1,000 VND (0.04 USD) per cigarette pack and 15,000 VND percigar since early January, 2020 would help reduce the rate of smokers byonly 1.5 percentage points and bring more than 3.9 billion VND (167,700 USD) tothe State budget.
However, he said, to achieve the national target on reducingthe rate of tobacco use by 6.3 percentage points by 2020, the absolute tax rateshould be 5,000 VND per pack. This would also bring 10.7 trillion VND (460million USD) to the State budget.
Do Thi Phi, a representative from the Centre for Research andCommunity Development Services, said the results from a public surveyimplemented in Hanoi and HCM City this January showed that the proposal onincreasing the special consumption tax rate on cigarettes received support from94 percent of participants.
Another survey implemented by the University of Commerce andHealthBridge Canada among 600 adolescents showed that 76.2 percent said thetobacco price was cheap and 83.5 percent agreed the tax on tobacco should beincreased.
PhD Nguyen Ngoc Anh, director of the Development and PoliciesResearch Centre, said many tobacco producers said the tax increase ondomestic-produced tobacco would increase the smuggling of tobacco.
This assumption was not accurate as the price of smuggledtobacco was much higher than the domestic-produced products, he said. Theconsumption of smuggled tobacco is all about consumers’ taste, not about theprices. He cited imported cigarette Jet as an example. The branch occupied 83.6percent of the market last year, and its price was much higher than that of thedomestic branches.
The conference was jointly held by the Ministry ofInformation and Communications and HealthBridge Canada.-VNS/VNA
VNA
