Zero export tax doesn't satisfy gold jewellery makers

Decree No. 122/2016/ND-CP sets a free export tax for gold jewellery and other gold articles with less than 95 per cent gold content from September 1. — Photo nld.vn

HA NOI (Biz Hub) – Gold jewellery and other gold articles with less than 95 per cent gold content enjoy zero export duty rates from September 1, under Decree No. 122/2016/ND-CP.

Under the circular, enterprises exporting gold jewellery, goldsmiths' wares and other gold articles under subheadings 71.13, 71.14 and 71.15 of the export tax schedule, which have under 95 per cent gold content, can declare export tax at zero per cent if they can show test results confirming the same, issued by organisations in charge of assessing gold content in jewellery and goldsmiths' wares.

The oganisations that can assess gold content are Quality Assurance and Testing Center 1, Quality Assurance and Testing Center 3, Doji Institute & Laboratory for Gemology and Jewellery, A Chau Commercial Bank-Gold Center or an organisation appointed by the Directorate for Standards, Metrology and Quality.

In 2015, the Finance Ministry, under Decision 36/2015/TT-BTC, imposed a new export tax on gold jewellery, following the increase of export duty from zero to two per cent on gold jewellery with purity of over 95 per cent.

While goldsmiths in Viet Nam welcomed the decision, most said it would not lead to much improvement in local jewellery exports, which have declined in recent years. Export value dropped from nearly US$3 billion in 2011 to only $670 million in 2014.

According to representatives from Phu Nhuan Jewelry Co (PNJ), the firm only exported less than 18-karat gold jewellery, or 75 per cent pure gold, therefore the decree would not benefit the firm.

Meanwhile, gold jewellery makers said the free import of gold material would be more helpful for them to compete against global rivals. Currently, they have to pay a higher price for raw material required for production since they cannot import gold on their own to lower input costs.

To control the local gold market, since May 2012, the State Bank of Viet Nam has been the only gold importer in the country. To better manage jewellery trading, the government instituted stronger measures last year to control the trading. — VNS