Processing cassava roots at the Intimex Thanh Chương cassava starch processing factory in the central province of Nghe An. (Photo baonghean.vn) For example, the association proposedhalving the 10 percent value added tax imposed on cassava, arguing that 80 percentof the products are exported and contribute to the country’s export revenue.
In addition, the association asked forhigh tariffs to be imposed on fresh cassava root exports to prevent them frombeing sold through the border gates to China, in order to ensure the supply ofraw material for local processing factories.
The association sought the reduction ofimport tax on fresh cassava roots from Laos and Cambodia to Vietnam to satisfythe country’s processing demand.
The VCA also asked the Ministry ofAgriculture and Rural Development (MARD) to work with China’s Ministry ofAgriculture so that the latter would allow the export of cassava pulp from Vietnamto the Chinese market, as it did with Laos and Cambodia.
However, most of the proposals havebeen rejected.
The MoF said amending value added taxrates on cassava starch and processed products from cassava fall under thejurisdiction of the National Assembly. It also said the proposal wasinconsistent with the VAT reform policy.
Regarding the proposal on theapplication of high tax rates to fresh cassava roots export, the ministry saidthe export tax rate stipulated under Decree 122 is currently zero percent.
However, the ministry has predictedthat global demand for dry chips for E10 gasoline will continue rising, thusthe exports should be encouraged.
Furthermore, cassava is an industrialplant that helps alleviate farmers’ poverty, especially those in remote areas,contributing to political stability and national defence by creating jobs andincome. The farmers will suffer the most from the export tax hike, the MoFargued.
Regarding the proposal to reduce theimport tax on fresh cassava roots, the MoF said the current import tax of 3 percentis suitable to protect Vietnamese cassava growers.
According to the association, with anarea of about 550,000 ha and a capacity of 10 million tonnes per year, thecassava planting industry attracts over 50,000 labourers working in industrialplants and processing facilities, and 1.2 million farmers.
Each hectare of cassava yields profitof about 11.6 million VND (515.5 USD), slightly lower than that of rice (14million VND per ha per year).
Vietnam’s export value of cassava andits products ranks second, behind Thailand, averaging 1-1.35 billion USD peryear.
In 2016 alone, the export volume ofcassava and products made from cassava reached 3.9 million tonnes, valued at 1.08billion USD, ranking fifth among Vietnam’s key export crops.-VNA
VNA
