Vietnam's National Assembly has approved a substantial increase in special consumption tax on alcoholic beverages, raising the rate from the current 65% to 90% by 2031. The new legislation, passed on Saturday, introduces a gradual increase: the tax will rise to 70% in 2027 and then to 90% four years later, instead of the originally proposed immediate hike to 100% (inside.beer, 14.6.2024).
The Ministry of Finance justified the measure as part of efforts to reduce alcohol consumption and address related public health concerns. Despite these intentions, the decision is expected to intensify pressures on the beer and spirits industry, which has already seen declining sales in recent years.
Vietnam is Southeast Asia’s second-largest beer market, with players including Sabeco (Thai Beverage) with 30.1m hl, followed by Heineken with 27.8m hl, Habeco with 8m hl, Carlsberg with 3.6m hl, Sapporo with 1.5 m hl and AB InBev with 1m hl (inside,beer, 22.5.2025). The sector has been grappling with reduced consumer demand, exacerbated by the strict 2019 zero-tolerance drink-driving law. In response to these challenges, Heineken suspended operations at one of its Vietnamese breweries in 2024 due to the deteriorating market environment and initial tax proposals (inside,beer, 24.6.2024)
The head of the Beer, Alcohol and Beverage Association reported that industry revenues have dropped consistently over the past three years. The potential negative impact on jobs and state income from the brewing industry was already raised in late 2024, when the National Assembly began discussing tax increases of over 50% (inside.beer, 22.11.2024).
In addition to alcoholic drinks, the new legislation also targets the soft drinks segment. A tax of 8% will apply from 2027 on beverages containing more than 5 grams of sugar per 100 milliliters, with a further increase to 10% planned for 2028. This measure aims to combat rising health risks such as obesity and diabetes.
