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December 22, 2011

 

Vietnam to lower import duty on raw fish

 

 

The Ministry of Agriculture and Rural Development (MARD) has sent an official letter to the Ministry of Finance (MOF) on initiating the deduction of import duty on raw fish and recommends that MOF considers and amends import duty rates for each fish in tandem with the practical situation.

 

The Vietnam Association of Seafood Exporters and Producers (VASEP) reports that the amended import duty will help to ensure the material supply for Vietnamese seafood processors without disordering the domestic seafood business.

 

At the same time, MARD directed the General Department of Customs to simplify the procedures of duty refund so that the enterprises importing raw materials do not pay duty deposit.

 

MARD believes that raw material importing for processing and exporting plays an important role in keeping the growth of seafood export revenue, accelerating operating capacity of processors, generating jobs, increasing the value-added products especially amid shortage of domestic raw material for processing and exporting.

 

However, the complicated procedures on duty refund are confusing to small and medium sized enterprises.

 

According to VASEP, many companies are hesitating over importing a large amount of raw fish in fear that they can not be refunded duty within the 275 days as required. Enterprises also face other difficulties in implementing the requirements in importing raw fish.

 

Currently, Vietnam is applying a higher duty rate on imported raw materials than that of its neighbouring countries such as Thailand and China who have a 0% duty rate.

 

China has succeeded in importing a large amount of raw fish for production of exported seafood. However, China has recently lost the prestige in product quality and food safety. Therefore, many Japanese and European companies tend to shift raw fish flows from China to Viet Nam for outsourcing, processing and exporting.

 

Hiking import duty on raw materials causes the increase in production costs and the price of products and the decrease in Viet Nam's processors' competitiveness with neighboring countries.

 

VASEP affirmed that importing raw fish will speed up export revenue without affecting the domestic fish production because imported raw fish is mainly frozen fish.

 

VASEP has requested that MOF and MARD approve an import duty rate of 1%, applicable to seafood with HS code 0306 and 0307 including black tiger shrimp, whiteleg shrimp, marine shrimp, octopus and squid in all varieties.

 

MARD and MOF have agreed with VASEP's proposal to speed up raw fish importation for processing and higher seafood export value.

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