Name of recommendations: Recommendations on participation in the draft decree of amending and supplementing the Decree No. 125/2017 of the Government’s Prime Minister.

Status: Responded

Recommended by units: 1. The Cat Phu Dong Nai Co., Ltd, address: Go Dau B Port, Phuoc Thai Commune, Long Thanh District, Dong Nai Province. 2. The Hanviha Plantation and Raw Material Production Company, address: the Hai Phong Village, Ky Loi Commune, Ky Anh town, Ha Tinh Province.

Official letter: No 1126/ PTM - VP, dated: 2019-05-17

Recommended contents:

Currently the Ministry of Finance is sending an official letter No. 2866 / BTC-CST dated March 14, 2019 to relevant ministries and departments for comments on the draft amendments to the Decree No. 125/2017 / ND-CP on proposing additional amendments, in which 2.5 item of wood chips, the Ministry of Finance submited to the Government for suggestions to relevant ministries to increase export tax on wood chips from 2% to 5%.

Citing the reasons for this proposal, the Ministry of Finance stated: at the Forum Conference on "Wood and forest product processing and export industry in 2018", the opinions suggested that there should be a solution to ensure wood material source and restrict the export of wood chips because people harvest young forest wood to make wood chips. On the basis of analyzing the data of export turnover in 2018, in order to ensure the source of wood materials for domestic production, at the same time, it did not affect too much on suppliers who were forest planters, limiting the situation of forest planners were forced price.

The enterprise would like to propose to the Government’s Prime Minister, related ministries and sectors to assess the impact of the adjustment to increase the export of wood chips to take measures and schedule in accordance with the following explanation:

1 / The operation of a market economy has a positive impact on forest plantation and forest product processing and wood chip processing. Forest planters have paid attention to appropriate business investment. Making full use of unused land and actively plant new ones after exploitation. The area and output of planted forests have continuously increased in the past years, which is the effect of the right policy of the state and the operation of the market economy.

2 / The investment cycle of afforestation must go through many years of management and care, there will be many risks. Most of the plantation areas were located in remote areas with high mountainous terrain, difficult transportation and costly exploitation. Therefore, forest growers needed the state to have a stable policy to secure their investment.

3 / Existing and increasing export of woodchip duties according to the proposal did not really affect exporters but will reduce the income of forest growers. This led to against the policy of the State at the condition and encourages farmers to gain high profits on the area of ​​crops.

4 / The impact of increasing wood chip export tax would probably affect the investment in afforestation, affecting the completion of the forest cover index from 41.6% to 45% under the Decision 419 / QD-TTG signed on April 5, 2017 for approval of the national program of Government’s Prime Minister on sustainable management of forest resources.

We hoped that the Government’s Prime Minister and relevant ministries and agencies considered the impact of the promulgated policy, especially paying attention to the income life of millions of farmers participating in afforestation, ensuring stable supply of raw materials for production and increased export turnover for the country.