Posted on 03 Nov 2015
The Ministry of Finance plans to impose a tariff of 10% on steel ingots and construction steel labeled as alloy steel from next year to prevent massive imports of cheap steel from China.
Nguyen Van Sua, vice chairman of the Vietnam Steel Association (VSA), cited the ministry’s recent document as saying that the 10% tax planned for imported steel containing boron and chromium is a short-term solution to stabilize the market and support domestic steel makers.
Sua told the Daily that domestic steel makers have been coping with difficulties this year, stoked by cheap steel imports from China.
According to VSA, more than one million tons of Chinese steel ingots had been imported into Vietnam in the year to mid-September, tripling that in the same period last year. The volume did not include hundreds of thousands of tons of construction steel said to contain boron to enjoy a zero tax rate, which has caused State budget revenue losses.
VSA said such steel ingots were declared as alloy steel but contained less than 0.3% chromium as required to enjoy an import tax of 0%. Such construction steel labeled as alloy steel for tax evasion is threatening domestic steel makers. If no bold measures are taken to redress the situation, losses would be huge for local steel makers and the State budget as well.
VSA has proposed Vietnamese authorities step up inspections into enterprises which have imported steel ingots containing chromium in the past year. If such steel ingots are found to be used for construction steel production, they should be fined and required to pay taxes.
“It’s time for Vietnam to adopt a number of solutions to protect domestic producers and new tax measures to support the local steel industry,” Sua said.
Vietnam imported nearly 10 million tons of steel in January-August, up a staggering 40% against the same period a year earlier. Nearly six million tons of the total volume was from China.
