Due to the ASEAN – Korea Free Trade Area (AKFTA), the Ministry of Finance (MOF) has decided to decrease the tariffs for a series of South Korean merchandise.

The newly announced decision of MOF, promulgating the Vietnam’s special preferable importing tax table to realize AKFTA, states that Vietnam’s special preferable importing tax will be applied to products imported from AKFTA including South Korea and outstanding ASEAN members if they abide by pre-agreed conditions.

In the new taxation table, new tax levels are applied to a series of goods including consumer goods, ingredients and industrial merchandises, many of which have already been applied with the lowest tax level of 0-5%. Tariffs of many types of merchandises for domestic production also have considerable reductions which will be continuously lowered due to the roadmap.

ASEAN – Korea Free Trade Agreement, in effect from June 1st creates the prospect of increasing the amount of exports from ASEAN countries, including Vietnam, to South Korea and vice verse. South Korea and ASEAN, excluding Thailand which has not approved the agreement, assent to remove the tariff barrier for more than 92% imports and exports by 2010.

Due to the roadmap, since June 1st, South Korea eliminates taxes for 7,991 out of 12,063 articles while ASEAN countries reduce taxes to 0-5% for 45% of the category of goods.

The agreement creates great opportunities for Vietnamese agricultural products such as coffee, tropical fruit and rice to tap into the South Korean market. At the same time, South Korean automobile accessories, cloth and fiber, artificial leather, cosmetics, paper, motorbikes, stationaries and household utensils will have stronger competitiveness thanks to preferable taxes.

Last month, Ministry of Finance also released the new preferable importing tax table for the ASEAN – China Free Trade Area as a part of the process of putting regional trading agreements into practice.


Source: vietnamnet