Glasses of Heineken beer are seen at a restaurant in Hanoi, Vietnam, May 30, 2019. Photo by Reuters
Vietnam’s National Assembly on Saturday approved a plan to raise the special consumption tax on alcoholic drinks from 65% to 90% by 2031, a move aimed at curbing consumption but one that adds further pressure on an already struggling industry.
Under the legislation, the tax rate on beer and strong liquor will rise to 70% by 2027, a year later than initially proposed, before reaching 90% in 2031.
Vietnam currently imposes a 65% tax on these products and the initial proposal last year had the tax rising to as high as 100%.
The finance ministry has said the aim of the higher taxes is to curb alcohol consumption. Vietnam is Southeast Asia’s second-largest beer market, according to a report by consultancy KPMG in 2024.
Vietnam’s beer industry, led by Dutch brewer Heineken, Denmark’s Carlsberg, and local brewers Sabeco and Habeco, has already faced challenges from stringent drink-driving laws introduced in 2019, which set a zero-alcohol limit for drivers.
The country’s Beer and Alcoholic Beverage Association chief has said industry revenue has declined for the past three years.
On Saturday, the lawmakers also approved a new levy of 8% on sugary drinks exceeding 5g/100ml of sugar that will take effect in 2027 and rise to 10% in 2028.
