Vietnam to Raise Alcohol Tax to 90% by 2031 Under New Legislation
National Assembly approves phased increase from 65% to 90% on alcoholic beverages and adds new levy on sugary drinks starting 2027
On 14 June 2025, Vietnam's National Assembly approved legislation to incrementally raise the special consumption tax on alcoholic beverages from the current 65% to 90% by 2031.
The revised schedule stipulates an increase to 70% by 2027, followed by annual increments culminating in a 90% rate by 2031.
This adjustment represents a moderation from an earlier proposal that suggested a peak rate of 100% by 2030.
The Ministry of Finance has indicated that the primary objective of this tax escalation is to mitigate alcohol consumption.
Vietnam ranks as Southeast Asia's second-largest beer market, with the industry comprising international brewers such as Heineken and Carlsberg, alongside domestic producers Sabeco and Habeco.
The alcoholic beverage sector has encountered challenges following the implementation of stringent drink-driving regulations in 2019, which enforce a zero-alcohol limit for drivers.
Industry reports have noted a decline in revenue over the past three years.
In response to diminishing demand and the initial tax hike proposal, Heineken suspended operations at one of its Vietnamese breweries in 2024.
In addition to the alcohol tax adjustments, the National Assembly sanctioned a new excise tax on sugary drinks containing more than 5 grams of sugar per 100 millilitres.
This tax will commence at 8% in 2027 and increase to 10% in 2028.
The Ministry of Finance has cited rising concerns over non-communicable diseases, including obesity and diabetes, as justification for the sugary drink tax.
Data indicates that the rate of child obesity in Vietnam increased from 8.5% in 2010 to 19% in 2020.
The World Health Organization has recommended a minimum tax rate of 20% on sugary beverages to effectively reduce consumption.
The newly enacted legislation also includes provisions to prevent double taxation.
Goods exported and subsequently re-imported into Vietnam will be exempt from the special consumption tax, as will items entering bonded warehouses intended for re-export.
The revised schedule stipulates an increase to 70% by 2027, followed by annual increments culminating in a 90% rate by 2031.
This adjustment represents a moderation from an earlier proposal that suggested a peak rate of 100% by 2030.
The Ministry of Finance has indicated that the primary objective of this tax escalation is to mitigate alcohol consumption.
Vietnam ranks as Southeast Asia's second-largest beer market, with the industry comprising international brewers such as Heineken and Carlsberg, alongside domestic producers Sabeco and Habeco.
The alcoholic beverage sector has encountered challenges following the implementation of stringent drink-driving regulations in 2019, which enforce a zero-alcohol limit for drivers.
Industry reports have noted a decline in revenue over the past three years.
In response to diminishing demand and the initial tax hike proposal, Heineken suspended operations at one of its Vietnamese breweries in 2024.
In addition to the alcohol tax adjustments, the National Assembly sanctioned a new excise tax on sugary drinks containing more than 5 grams of sugar per 100 millilitres.
This tax will commence at 8% in 2027 and increase to 10% in 2028.
The Ministry of Finance has cited rising concerns over non-communicable diseases, including obesity and diabetes, as justification for the sugary drink tax.
Data indicates that the rate of child obesity in Vietnam increased from 8.5% in 2010 to 19% in 2020.
The World Health Organization has recommended a minimum tax rate of 20% on sugary beverages to effectively reduce consumption.
The newly enacted legislation also includes provisions to prevent double taxation.
Goods exported and subsequently re-imported into Vietnam will be exempt from the special consumption tax, as will items entering bonded warehouses intended for re-export.
