HANOI, June 14 — Vietnam's National Assembly approved a proposal today to raise the special consumption tax on alcoholic beverages to 90 per cent by 2031 from the current 65 per cent, a move that will add to challenges facing the industry, even though the top rate will not be as high as first flagged.
Under the legislation, the tax rate on beer and strong liquor will rise to 70 per cent by 2027, a year later than initially proposed, before reaching 90 per cent in 2031.
Vietnam currently imposes a 65 per cent tax on these products, and the initial proposal last year had the tax rising to as high as 100 per cent.
The Finance Ministry said the higher taxes aim to curb alcohol consumption. Vietnam is Southeast Asia's second-largest beer market, according to a report by consultancy KPMG in 2024.
Vietnam's beer industry, led by Dutch brewer Heineken, Denmark's Carlsberg, and local brewers Sabeco and Habeco, has already faced challenges from the introduction of stringent drink-driving laws in 2019, which set a zero-alcohol limit for drivers.
The country's Beer and Alcoholic Beverage Association chief has stated that industry revenue has declined over the past three years.
In response to weakening demand and the initial proposal for a tax hike, Heineken suspended operations at one of its Vietnam breweries last year.
The lawmakers also approved a new levy of eight per cent on sugary drinks exceeding 5g/100ml of sugar that will take effect in 2027 and rise to 10 per cent in 2028.
— Reuters
