New law to levy environment tax on five groups of products
Any enterprise or individual who exploits, produces or imports five groups of products classified as hazardous to the environment will be imposed with an environment tax in the coming time, according to the Draft Law on Environment Tax.
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| Vietnam each year spends some VND4 trillion from the state budget for environment protection, but the fees on environment protection collected annually is only VND1.2 trillion. |
Under the draft law being prepared by the Finance Ministry and the National Assembly’s Financial and Budgetary Committee, products to be subject to the new tax are petrol and oil, coal, freezing substances containing hydro-cloro-fluoro-carbon (HCFC), plastic bags and substances for plant protection.
Vu Van Truong, head of the Finance Ministry’s Department of Tax Policy, told a seminar on contributing suggestions for the new draft law held here on Tuesday that if the law was passed and enforced by the National Assembly in October 2011, it would become effective on January 1, 2012.
According to the draft law, the main products to be taxed are petrol, diesel oil, coal (except peat), HCFC substances, plastic bags (except biological bags), mosquito-repellent, chemicals for agricultural cultivation and decontaminating substances.
According to the draft law, the environment tax is between VND1,000 and VND4,000 on each liter of petrol, between VND500 and VND2,000 on each liter of diesel oil, between VND6,000 and VND30,000 on each ton of coal, between VND20,000 and VND30,000 on each kilogram of plastic bags and between VND1,000 and VND5,000 on each kilogram of plant protection substances.
Truong of the tax policy department says it is necessary to promulgate the environment tax law because the country lacks essential financial means to protect the environment as pollution mounts day by day.
“The law will help create more positive awareness of environment protection, reduce harmful effects on public health and generate budget for the activity of environment protection,” Truong told the seminar.
Vietnam each year spends some VND4 trillion from the state budget for environment protection, but the fees on environment protection collected annually is only VND1.2 trillion.
Truong said levying the tax on the five groups of products would help the country collect some VND50 trillion each year. The money will be re-invested into environment protection activities.
Many environmental experts at the seminar said the law makers should carefully consider each level of environment tax on particular products in accordance with the degree of harm to the environment.
Most of the scientists and environmental experts at the seminar agreed on the need for enforcing the law on environment tax. But they suggested the environment fee be dropped when the new law takes effect.
Nguyen Dinh Tuan, rector of the HCMC College of Natural Resources and Environment, said it would be illogical for enterprises or individuals to pay both environment protection fees and environment tax for producing one product.
“In my opinion, we don’t need fees for environment protection when the environment tax is levied. It’s also important to expand the tax to producers and importers of tobacco and batteries,” Tuan said.
Tuan added that producers would increase their prices and that in the end the environment tax would fall on the consumers.
