Several legislators at a working session of the National Assembly (NA) discussed not increasing special consumption tax (SCT) on draught beers and air conditioners, but instead raising the tax on golf services.

“We should not increase the tax on bia hoi [the popular draught beer], as the product is mainly consumed by low-income laborers,” Deputy Ngo Van Minh from Quang Nam Province said when discussing the SCT draft law amendment Monday.

Some delegates said increasing tax on draught beer would cause a shock to beer producers and even push some to the brink of bankruptcy because most of them are small and medium enterprises with limited financial capacity.

“Up to 50 percent of draught beer makers could not remain in operation when we increased the tax to 40 percent [in 2008] from the previous 30 percent,” said Deputy Vo Minh Thuc from Phu Yen Province. “How many firms can still exist when we raise the tax to 50 percent?”

SCT on draught beer should instead be decreased to 30 percent, equaling the figure applied in 2006 and 2007, Thuc said, adding that locals need to have access to decent draught beer at reasonable prices.

Some NA representatives also said SCT should not be imposed on air-conditioners, as the draft law suggested levying a 15-percent tax on machines with up to 90,000 BTU (British thermal unit) capacity.

“We should not regard these air-conditioners as a luxury item,” said Deputy Mai Huu Tin from Binh Duong Province. “Air-conditioners are necessary equipment, helping to improve people’s health and increase labor productivity.”

However, other delegates said air-conditioners are common only in urban areas and they remain an extravagant item in the countryside, so legislators should reduce SCT on the product rather than remove it entirely.

In terms of golf services, several delegates propose upping the tax since the government is currently discouraging construction of golf courses which uses much agricultural land and causes environmental pollution.

“I suggest raising the tax on golf services to 25-30 percent, compared to the 20 percent suggested by the draft law, because most of the users are high-income individuals,” said Deputy Ha Tuan Hai from northern Phu Tho Province. “A higher tax may limit the expansion of golf fields, which would swallow up farmlands and threaten cooking security.”

On the sidelines of the session Monday, Minister of Finance Vu Van Ninh told reporters about reasons for the deflation this month.

“The fall in consumer price index (CPI) in October is tied to the impacts of governmental measures to reduce inflation and the global economic recession,” he said.

According to Ninh, policy measures to combat inflation have taken effect over the past few months, while the global financial turmoil has precipitated sluggish production, resulting in decreasing prices of goods and services. World oil price dropped below US$70 per barrel last weekend, from the peak of over $147 a barrel in mid-July.

Vietnam’s CPI in October dropped 0.19 percent from September, the first monthly fall since last March, according to the General Statistics Office.

Reported by Bao Van