Business
Ministry proposes cement export tax cut
  • By Nguyen Tuyen | dtinews.vn | July 22, 2017 07:00 AM
The Ministry of Planning and Investment (MPI) has proposed a reduction for cement export tax to help ease the oversupply in the domestic market.

In a recent report to the government, the MPI said that Vietnamese cement firms are seeking ways to deal with their great inventory.

  

Vietnam's cement sector sees the oversupply


Under the government’s regulations which have taken effect since last year, cement is among good products processed from natural resources and minerals which are subject to an export tax of 5% and will not receive value added tax (VAT) refunds.

With the regulations, Vietnamese cement products have become less competitive against regional countries such as China, Thailand, Indonesia and Japan due to the higher export costs, leading to operational and business difficulties for many companies.

In response, the MPI has asked the government to slash the cement export tax and allow firms to benefit from VAT refunds for cement exports.

The General Department of Customs’ statistics showed in 2016, Vietnam exported 14.7 million tonnes of cement and clinker with a total value of USD560 million. At present, cement supply in the Vietnamese market is around 20% higher than demand.

Meanwhile, Vietnam’s cement exports are facing fierce competition from China which has a high inventory of 670 million tonnes. China is seeking to boost the cement exports.

The Vietnam Cement Association forecast that the country’s total cement output might reach 108 million tonnes in 2018 and the figure would be 120-130 million by 2020, so by this time, the cement inventory would be 36-47 million tonnes.

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