Awakening the Jewelry Gold Market

To achieve this, it is essential to promptly remove jewelry gold from the list of conditional business sectors, allow qualified enterprises to import raw gold, and especially reduce export taxes on jewelry gold.

Abundant Potential

Vietnam is currently in a demographic golden period, with 69% of the population in the working and consumption age, of which 51% are women. This demographic group has a significant demand for jewelry gold.

Moreover, Vietnam’s economy has been experiencing high and stable growth over the years. The country’s GDP per capita is projected to reach approximately $5,000 per person by 2025, marking the beginning of a consumption boom in Vietnam.

With a golden demographic structure, high GDP growth, and continuously rising per capita income, the demand for jewelry and fine arts products in Vietnam is expected to increase significantly. Additionally, consumer trends are shifting from buying gold for accumulation purposes to fashion and beauty. Therefore, the mid-range and high-end product segments still have substantial growth potential in the coming years.

"Unshackling" Legal Barriers

The 2020 Investment Law classifies "gold trading" as a conditional business sector, which is deemed inappropriate. This classification encompasses all activities related to the production, processing, trading, import, and export of bullion gold, jewelry gold, fine gold, and raw gold.

For many years, this regulation has posed numerous challenges to the jewelry gold industry by increasing administrative procedures, significantly raising business costs, and reducing business opportunities due to the lengthy licensing process.

According to Clause 1, Article 7 of the 2020 Investment Law, conditional business sectors are those that must meet necessary conditions for reasons such as national defense, security, social order, and safety. However, jewelry gold is a regular consumer good, and its production does not affect these factors. Therefore, the National Assembly should consider removing jewelry gold from the list of conditional business sectors.

Encouraging Exports

Previously, when the export tax on jewelry and fine gold was set at 0%, many enterprises were able to export large quantities of gold, creating jobs for hundreds of workers and contributing to foreign exchange inflows and state budget revenues through corporate income tax and VAT. For instance, during the period 2016–2020, DOJI Group exported $2.5 billion worth of jewelry gold.

However, under current regulations, the government imposes a uniform 2% export tax rate on all gold products, regardless of gold content. Since the introduction of this regulation, gold businesses have been unable to export jewelry gold.

Mr. Đinh Nho Bảng, Vice Chairman and General Secretary of the Vietnam Gold Business Association, emphasized that reinstating the 0% export tax rate on jewelry gold, as previously applied, is crucial to boost exports, regenerate foreign exchange for the country, and curb illegal gold exports.

To promote jewelry gold exports, the State Bank of Vietnam (SBV) must also meet the demand for raw gold among businesses. Decree 24/2012 outlines the conditions, documentation, and procedures for businesses to be licensed to import raw gold. However, for many years, businesses have been unable to import raw gold, while Vietnam's domestic gold production is only about 1.5 tons per year. As a result, businesses have had to source raw gold from the unofficial market, exposing them to quality risks and inadvertently supporting gold smuggling, leading to foreign exchange outflows from the country.