CaliToday (01/10/2025): The Vietnam Association of Financial Investors (VAFI) has ignited a significant debate within the nation's financial sector by proposing a 10% tax on the sale of gold bars and jewelry.
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| Deputy Minister of Finance Cao Anh Tuan outlined new points of the draft Law on Personal Income Tax (amended). Photo: National Assembly |
This high-profile recommendation aims to achieve two primary objectives: to stabilize the increasingly volatile domestic gold market and to generate a substantial new source of revenue for the state budget.
The proposal comes at a critical time. Vietnam's domestic gold market, particularly for the state-monopolized SJC brand, is experiencing an unprecedented disconnect from global prices.
The Context: A Disconnected Market
In recent months, domestic SJC gold prices have surged, at times trading at a massive premium of 15-20 million VND (approx. $600-$800) per tael over international spot prices. This morning alone, SJC prices saw another sharp increase, even as global prices trended downward overnight.
VAFI argues that this extreme price gap is fueled by rampant speculation and hoarding. Because gold transactions are currently not subject to the same level of taxation as other investments, speculators can buy and sell for large profits without contributing to state revenue.
"The state does not collect taxes from gold bar trading, leading to a loss of revenue and creating an unfair playing field compared to other investment channels like stocks or savings deposits, which are taxed," a VAFI representative stated.
Impact of the 10% Tax Proposal
According to VAFI, the 10% tax—which could function as a Special Consumption Tax (SCT) or a high-rate VAT—would serve as a powerful tool to:
Curb Speculation: A significant tax would make short-term, speculative "surfing" of gold prices far less profitable, thereby reducing artificial demand.
Increase Revenue: With billions of dollars in gold traded annually, a 10% tax would capture significant funds for public spending.
Promote Fairness: It would align gold as an investment asset with other financial instruments that are already taxed.
Critics Warn of Unintended Consequences
Despite VAFI's reasoning, the proposal has been met with immediate and strong skepticism from many economic experts and industry insiders.
Critics argue that the 10% tax fails to address the root cause of the price gap: the restrictive supply measures under Decree 24. This 2012 decree grants the state a monopoly on the production of SJC gold bars and heavily restricts the import of raw gold, leading to a severe domestic supply shortage.
Experts warn that rather than stabilizing prices, a 10% tax would likely:
Be Passed to Consumers: Sellers would simply add the 10% tax to the final price, pushing the already sky-high domestic price even higher.
Fuel the Black Market: A high tax would almost certainly drive a large volume of transactions underground, increasing smuggling (buôn lậu) from neighboring countries and making the market less controllable.
Hurt Ordinary Savers: Many Vietnamese citizens buy gold not for speculation, but as a traditional, long-term store of value. A high tax would penalize ordinary people seeking to protect their savings.
The proposal is now at the center of a national discussion, highlighting the urgent need for a comprehensive reform of gold market regulations to bridge the gap between domestic and international prices.