UK pledges to eliminate more than 94% of tax lines for Vietnam once CPTPP becomes effective

The UK is set to eliminate 94.4 percent of tax lines for Viet Nam with its commitments in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), Minister of Industry and Trade Nguyen Hong Dien told legislators on Saturday.

Viet Nam's key export goods like rice, aquatic products and cassava powder shall be entitled to enjoy lower tax rates compared to the UK's commitments in the UK-Viet Nam free trade agreement (UKVFTA), the minister added.

With regard to rice, the UK pledges to increase import quota from 3,300 tons from the first year the CPTPP takes effect in the UK to 17,500 tons from 2030, almost doubling the rice quota applicable to other CPTPP signatories.

In addition, tuna, another key export product of Viet Nam, shall be exempted from tax since the effective date of the CPTPP.

Long with joining the CPTPP, the UK has officially recognized Viet Nam's market economy status, making it easier for Vietnamese goods to penetrate the European country's market, according to Nguyen.

On February 1, 2021, the UK officially submitted its application to join the CPTPP, which was followed by negotiations between the UK and the CPTPP member countries. The UK has formally completed CPTPP ratification procedures.

The National Assembly of Viet Nam is expected to consider and decide on the ratification of the document on the UK's accession to the CPTPP at the ongoing seventh session.

The UK's accession to the CPTPP will further reinforce Viet Nam's role with the UK in the region, enhance the Southeast Asian country's position in international economic cooperation, and strengthen bilateral relations with the UK, noted Vice President Vo Thi Anh Xuan.

"As the UK joins the CPTPP, we are going to see some real benefits to our bilateral trade in areas where the CPTPP agreement goes further than the UKVFTA in areas of agriculture and digital trade which are areas where we want to see further growth", highlighted British Ambassador to Viet Nam Iain Frew in a recent interview with VGP reporter.

Vietnamese and British consumers will access a wider range of higher quality and cheaper goods and services while the two nations' businesses will become increasingly integrated as they participate in value chains together, said the diplomat.

Source: Vietnam Economic News