Vietnam Finance Ministry Seeks Tax Incentives for Certain Medical Components

Vietnam’s Ministry of Finance (MoF) is seeking the government’s approval for partial or total import duty exemption regarding seven kinds of medical components in a bid to boost the domestic manufacture of medical equipment.Accordingly, components which have yet to be made locally shall be imported by or under proxy from businesses sufficiently meeting conditions set by the Ministry of Health (MoH) on the manufacture or assembly of medical equipment.These components must be on the list of MoH certified technical designs for medical equipment manufacture and not belong to the list of locally-made materials and semi-processed items as approved by state agencies.The MoH said the scope of components qualified for a tax break should be expanded as the country has around 100 units engaging in the research and manufacture of medical equipment diverse in size and type.Opposing this view, the MoF argued that medical tax breaks are only used to encourage import of components for manufacturing medical equipment within the state’s development orientations, but too many types of medical equipment used outside the health sector make the tax incentives unfeasible.In July 2012, Deputy Prime Minister Nguyen Thien Nhan urged the MoH to develop and enact a list of high-efficiency medical equipment to be prioritized for domestic investment and production.This is not a new proposal as Deputy PM Nhan had asked the MoH in 2010 to work with the MoF and Ministry of Industry and Trade on measures to support the local manufacture of medical equipment. (hanoitimes.com.vn Jan 25)