Green tax leads to colourful debate

Consumers using some products causing environmental pollution will be taxed under a new environmental protection tax law.

The law, the first of its kind in Vietnam, aims to protect the environment and is being discussed at the ongoing 12th National Assembly’s (NA) eighth session, which started last week.

The draft law stipulates that consumers will have to pay a tax included in  products’ price when purchasing products causing environmental pollution.

There are eight product categories to be taxed, including the gasoline, petroleum and lubricant group, which will be taxed between VND300-4,000 per litre.

The coal group will be taxed between VND10,000-30,000 per tonne, hydro chlorofluorocarbons will be taxed between VND1,000-5,000 per kilogramme, nylon (VND30,000-50,000 per kilogramme), pesticides (VND500-2,000 per kilogramme), chlordane used to kill wood-eaters (VND1,000-3,000), forestry product preservatives (VND1,000-3,000) and germicides used to clean warehouses (VND1,000-3,000).

However, northern Tuyen Quang province NA deputy Phan Thi My Binh said the eight categories to be taxed were insufficient and would not help Vietnam reduce environmental pollution.

This was because many other products were also damaging the environment, such as cigarettes, chemicals, traffic and even gold exploitation. Coal, gas, batteries, abattoirs, industrial parks and enterprises discharging waste were also serious polluters.

Central Nghe An province deputy Thai Thi An Chung saw cigarettes as one of the biggest pollution sources which needed to be taxed under the new law.

“Vietnam annually produces more than four billion cigarette packs, which harms people’s health and the environment. Some 95 per cent of cigarette filter tips cannot be recycled, as they are made out of special plastic that takes years to disintegrate,” Chung said.

“An environmental protection tax on cigarettes will increase this product’s price and limit consumption,” she said.

Deputy Nguyen Thi My Huong from central Quang Nam province said that many deputies wanted automobiles and motorbikes to be also taxed under the new law.

“In many European countries, such a tax has been applied for decades. In Vietnam’s cities, 70 per cent of pollution is caused by automobiles and motorbikes,” Huong said.

Like many other deputies, southern Tien Giang province’s Tran Van Tan recommended that the tax for nylon be raised to VND40,000-60,000 ($2.1-$3.1) per kilogramme to limit the use of this product.

“Nylon is seriously destroying the environment. Millions of nylon bags are used in Vietnam each day and the material takes hundreds of years to disintegrate,” Tan said.

The NA Standing Committee said that more products might also be added to the law in the future based on the country’s economic development roadmaps, and that the NA would determine imposing environmental protection taxes on more products under the new law.

Minister of Finance Vu Van Ninh said that many foreign countries did not impose this type of tax on all products causing pollution.

“This makes us carefully consider what products are to be taxed in order to be suitable to Vietnam’s economic development levels, while keeping Vietnamese goods competitive globally,” he said.

The law is expected to be approved at this NA session and will take effect from January 1, 2012.