Most domestic jewellery producers have ignored an increased export taximposed on gold jewelry, as the new duty does not affect theirbusinesses.
Under Decision 36/2015/TT-BTC, the Finance Ministryon May 7 imposed a new export tax on gold jewellery, in which an exportduty on gold jewellery that is more than 95 percent pure increased fromzero to two percent. The decision, however, maintains zero percent dutyon gold jewellery that is 95 percent pure or less.
Previously,the Vietnam Gold Trade Association asked the ministry not to increasethe duty, as it was concerned that a new duty would affect local goldbusinesses. The association said that foreign competitors of Vietnamesejewellery producers, such as China, Thailand, Indonesia and India, notonly had better technology, but also were allowed to import gold with noexport duty being imposed on gold jewelry.
Representatives from Phu Nhuan Jewelry Co (PNJ) said that PNJ onlyexported jewellery that is less than 18-karat gold, or 75 percent puregold, so the new export tax would have no affect on the company.
In fact, Vietnam's jewellery exports have steadily decreased in recentyears, from nearly US$3 billion in 2011 to only 670 million USD in2014.
The country currently has three jewelryexporters of PNJ, SJC and DOJI, however, exports account for a modestpart of the firms' total turnover.
The exportersnoted that it would be increasingly difficult to compete against otherglobal rivals, as they have to pay a higher price for raw materials fortheir production since they cannot import gold by themselves to lowerinput costs. Since May 2012, the State Bank of Vietnam has been the onlygold importer in Vietnam to improve their management of the local goldmarket. However, experts said that another reason for Vietnamesejewellery becoming less competitive was due to claims by some jewelleryproducers who mislead customers about the purity of gold content.
To better manage jewellery trading, the Government institutedstronger measures last year to control the trading. Further, largejewellery producers with trademarks hope this would help them developtargets for export, especially if the central bank allowed them toimport gold for use in producing jewellery.-VNA
Under Decision 36/2015/TT-BTC, the Finance Ministryon May 7 imposed a new export tax on gold jewellery, in which an exportduty on gold jewellery that is more than 95 percent pure increased fromzero to two percent. The decision, however, maintains zero percent dutyon gold jewellery that is 95 percent pure or less.
Previously,the Vietnam Gold Trade Association asked the ministry not to increasethe duty, as it was concerned that a new duty would affect local goldbusinesses. The association said that foreign competitors of Vietnamesejewellery producers, such as China, Thailand, Indonesia and India, notonly had better technology, but also were allowed to import gold with noexport duty being imposed on gold jewelry.
Representatives from Phu Nhuan Jewelry Co (PNJ) said that PNJ onlyexported jewellery that is less than 18-karat gold, or 75 percent puregold, so the new export tax would have no affect on the company.
In fact, Vietnam's jewellery exports have steadily decreased in recentyears, from nearly US$3 billion in 2011 to only 670 million USD in2014.
The country currently has three jewelryexporters of PNJ, SJC and DOJI, however, exports account for a modestpart of the firms' total turnover.
The exportersnoted that it would be increasingly difficult to compete against otherglobal rivals, as they have to pay a higher price for raw materials fortheir production since they cannot import gold by themselves to lowerinput costs. Since May 2012, the State Bank of Vietnam has been the onlygold importer in Vietnam to improve their management of the local goldmarket. However, experts said that another reason for Vietnamesejewellery becoming less competitive was due to claims by some jewelleryproducers who mislead customers about the purity of gold content.
To better manage jewellery trading, the Government institutedstronger measures last year to control the trading. Further, largejewellery producers with trademarks hope this would help them developtargets for export, especially if the central bank allowed them toimport gold for use in producing jewellery.-VNA
