Cooperation seeks to better regulate informal distillers and raise tax income

Policymakers, experts, and businesses gathered at a meeting on January 14 to review the implementation of the pilot programme

The event held by the Vietnam Beer Alcohol Beverage Association (VBA), the Ministry of Industry and Trade (MoIT), and the Vietnam Alliance for Responsible Drinking (VARD), attracted representatives the provincial departments of industry and trade, experts, business associations, and companies in the beverage industry.

The pilot programme was carried out in the northern province of Ninh Binh during 2020-2021 and produced positive results. Specifically, the number of household producers of traditional alcoholic drinks registering their activities with local authorities has increased 68 per cent.

Moreover, many communication activities and workshops were held to help improve local people’s awareness about legal documents and knowledge about alcoholic drinks, as well as alcohol abuse.

Despite this, many problems remain in state management on traditional alcoholic drinks in Ninh Binh. For instance, nearly three-fourths of surveyed household producers said that they have yet to register their products with local authorities. And 85.2 per cent of them do not know anything about registration regulations.

Worse still, awareness of household producers about compliance with production rules like food safety, origins of raw materials, and registration remains limited, as only 36 per cent are aware of these.

According to statistics from the MoIT, nearly 300 litres of traditional alcoholic drinks are sold in the market annually which have no clear origin, no brand, and no quality certification.

Despite efforts from state authorities, the management of traditional alcoholic drinks remains a hard task, causing a huge loss for tax collection, while increasing the healthcare burden and human loss.

According to a 2020 survey by the Central Institute for Economic Management, traditional alcoholic drinks caused tax losses of about $750 million, making up 29 per cent of total tax loss caused by the informal sector.

In this context, the VBA, the MoIT, VARD, and the Ninh Binh's Department of Industry and Trade coordinated to carry out the pilot programme to assess the practical situation of production of traditional alcoholic drinks, and then make policy recommendations to enhance the state management.

Ludovic Ledru, chairman of VARD said, “The facts prove the state incurs a huge tax loss from the informal alcohol sector. If the state has appropriate policies to convert all household producers into formal actors, the state coffer will increase significantly annually.”

Ledru expressed his belief that better management of traditional alcoholic drinks not only increase the state’s tax collection but also creates higher-quality alcoholic drinks, thus protecting people’s health and creating a healthy business environment for official producers.