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In a recent proposal to the government, Lao Cai-based Vietnam Apatite Company Limited (Vinaapaco) proposed lower export duties for its mineral export shipments in 2013.
In late January 2013, the Ministry of Industry and Trade (MoIT) agreed that businesses based in northern highland Lao Cai province to resume export of their stockpiled mineral volumes after receiving oversight reports from local authorities.
Accordingly, Vinaapaco was allowed to export its 450,000 tonnes stockpiled apatite ores from 2012
Earlier, in April 2011 state agencies gave the nod for Vinaapaco to export processed apatite ores in volumes not surpassing 500,000 tonnes per year within 2012.
The company then signed export contracts with big customers in India, Japan and Australia right in late 2011.
However, its export plans were disrupted following prime ministerial Instruction 02/CT-TTg in January 2012 fostering state management towards exploration, extraction, processing, usage and export of minerals.
After more than a year of temporary cessation, the company can now resume export of apatite ore stockpile following MoIT’s recent move.
However, at this time apatite ores incur higher export duties than those in the period before 2013.
As per Circular 193/2012/TT-BTC, effective from January 1, 2013 the new tax rates applicable to apatite ores of diverse types hike from 5 to 10 per cent over previous levels.
The company argued higher export duties to its stockpiled export volumes could significantly lower export efficiency and reduce finance sources for investment development needs.
It has then proposed competent state agencies apply former tax rates regulated in Ministry of Finance’s Circular 184/2010/TT-BTC to its [apatite ore] export shipments, according to the company’s general director Nguyen Quang Huy.
Unlike Vinaapaco which asks softer export duties for its stockpile mineral volumes, Thai Nguyen-based Nui Phao Mining Company Limited wanted lower tax rates for mineral products at its project which is about to come online.
A company source reveals when licensed in 2004 wolfram ores incurred zero per cent export duty. The rate shot to 15 per cent in 2010 when the project embraced restructuring and hiked to 20 per cent from early 2011.
It is current 30 per cent to raw wolfram ores and 20 per cent to fine ones.
The company argued its investment into Nui Phao project would run out of profits if the export duty on wolfram ores augmented to 40 per cent by 2014.
That is because up to 80 per cent of the company products earmarked for export as local demands for wolfram and other mineral products at its project are rather low.
Nui Phao Ltd. had spent over VND6 trillion ($285 million) on the project for development targets since its restructuring. The company then proposed a 10 per cent export duty for its products to honour its strenuous efforts when doing investment in a location with difficult economic conditions in Thai Nguyen province.