Study on the Excise tax system
Introduction and recommendations for Vietnam
This report summarises the advantages and challenges of the excise tax policy on tobacco products based on the current legal regulations in Vietnam and by acknowledging the proposal put forth by the Vietnam Ministry of Finance (“MOF”) on a new excise tax calculation method using the hybrid method (combination of ad valorem and specific tax to replace the current ad valorem only system). The report also briefly analyzes the effects of the current excise tax policy on the entire tobacco industry and its stakeholders through analysis and assessment of the direct and indirect impacts of the current excise tax policy from different perspectives (e.g. impact on the volume of tobacco consumed, government revenues, the illicit trade as well as the impacts on smoking behaviour and tobacco manufacturers, etc.).
