Vietnam to Cut Sugar Tax to 15 Pct

Tariffs on imported crude and refined sugar will be slashed to 15 percent as from April 15, the Ministry says in its recently issued circular.

Tax on crude sugar imports will accordingly be cut to 15 percent from a previous 25 percent level while that on refined sugar will go down to the same rate from a much higher 40 percent duty.

The tax cuts are meant to lower domestic sugar prices that have stayed at VND22,500-24,000 (US$1.09-1.16) per kilogram since Tet holiday whereas sugar with government subsidies has been traded at a mere VND18,000 ($0.87) per kilo, the Ministry said.

The Ministry of Industry and Trade earlier introduced a quota of 250,000 tons on sugar import in order to help stabilize sugar prices, especially towards the end of the year.

Vietnam on February 22 cut tax on oil and petrol imports for the fifth time since late last year to zero percent from the previous 2-5 percent to ease pressure on domestic prices.

It has been using its price stabilization fund as a tool to keep down prices and contain inflation which, together with a stable macro-economy, is a top priority on its economic agenda this year.

The country has set its inflation target this year at 7 percent or less after last year's 11.75 percent rate, way above the initially proposed 8 percent one.