The State Bank of Vietnam (SBV) has proposed the Ministry of Finance levy a special consumption tax on gold, said a banking official.
Speaking with DTiNews, SBV Deputy Governor Le Minh Hung said the move of the bank’s management over the gold market is to prevent it from affecting the macro-economy, stabilise the foreign exchange rate, and make the precious metal less attractive to the public.
He added that individuals and organisations that trade gold in other countries currently have to pay value-added and special consumption taxes.
The tax was put on the table as the government currently is discouraging the public from keeping gold as an asset. Gold is now only subject to a 10% export duty, while unprocessed gold is imported at a zero percent tariff.
Hung said the government was not involved in stabilising gold prices as people are not allowed to keep gold and gold is not included in commodity basket for the consumer price index calculation.
People is now benefiting from the huge VND3 million (USD142.8) difference between domestic and global gold prices, which negatively affects credit institutions which have savings in gold, he added.
“People deposit their gold when prices are low; and now that prices have increased depositors will enjoy profits, while the situation is reversed for banks,” the official explained.
Over the past six months, credit organisations bought roughly 60 tonnes of gold. They still need an additional 20 tonnes of gold to repay depositors by November 25, when gold depositing is scheduled to be stopped. It would take them two months for accumulate enough gold.
Cao Sy Kiem, Former Governor of the State Bank of Vietnam, said gold market management includes different issues such as import and export, business and criteria for gold bar storage, therefore agencies should have specific instructions if taxes are applied.
