Proposed tax reduction on importing materials for feed production

From October 2020 until now, the prices of main ingredients for animal feed products such as corn and wheat have continuously increased with an average increase of 30-35% (according to the Ministry of Finance).

The main reason for the increase in raw material prices is due to the effects of the Covid-19 epidemic, which has caused a sharp increase in freight rates for many types of goods. Besides, the demand for imported feed ingredients has increased to a record recently because of the recovery in production in many countries.

The increase in raw material prices has led to a sharp increase in the price of finished animal feed products in the first 6 months of 2021 compared to the same period in 2020. Meanwhile, industrial animal feed production in Vietnam still depends largely on imported feed ingredients. The high price of animal feed has caused livestock households to temporarily stop re-herding for the time being. If this situation continues, the domestic supply of poultry products will decrease in the near future.

In order to contribute to reducing input costs for domestic production, the Ministry of Finance has submitted to the Government to consider reducing the MFN import tax rate of wheat and corn products.

Specifically, the Ministry of Finance proposed to reduce the MFN import tax rate of wheat, HS code 1001.99.99 from 3% to 0%; reduce the MFN import tax rate of corn products, HS code 1005.90.90 from 5% to 3%.

Vinacontrol is the unit appointed to carry out certification of conformity in the field of animal feed; quality conformity certification and testing of animal feed for imported and exported livestock and poultry.

Contact Vinacontrol: (+84) 24 3943 3840