- Vietnam’s pepper sector faces VAT imbalances with high refunds compared to contributions.
- The industry received $83 million in VAT refunds but contributed only $2.2 million.
- The Vietnam Pepper and Spice Association (VPSA) has petitioned for VAT policy review.
- Vietnam exports 95% of its pepper, with only 5% consumed domestically.
- Domestic sales generate minimal VAT, while exports qualify for full refunds.
- The spice sector exported over 400,000 tons in 2024, with significant VAT refunds.
- VPSA warns of fraud risks in the VAT refund process for exports.
- Proposed reforms include a 0% VAT rate for export inputs and a 0.5% export tax.
- VPSA suggests maintaining a 5% VAT rate for domestic consumption.
- The current VAT structure burdens exporters, affecting competitiveness.
- Proposed reforms aim to improve transparency and efficiency in the tax system.
Source: vietnamnet.vn
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
