By Timothy S. Donahue

Top Takeaways:

• Vietnam will introduce a fixed per-pack cigarette excise tax beginning in 2027, rising to 10,000 dong per pack by 2031.
• The new system retains the 75% ad valorem tax and adds a second, absolute component starting at 2,000 dong per pack.
• Health officials say Vietnam’s tax burden is 36.8% of the retail price, below WHO recommendations, and are proposing additional tobacco-control measures.

Vietnam will introduce a fixed (absolute) excise tax on cigarettes starting in 2027, adding a per-pack levy on top of its existing ad valorem tobacco tax as Hanoi steps up efforts to curb smoking, according to state media and health ministry-linked reporting.

Under amendments to Vietnam’s Special Consumption Tax law, cigarettes will be subject to a mixed tax regime beginning Jan. 1, 2027, combining the current 75% ad valorem excise rate with a fixed levy starting at 2,000 dong (US$0.07) per pack. The per-pack component will then rise annually to 10,000 dong per pack by 2031.

Vietnamese health officials have argued that past increases did not materially reduce smoking because excise levels remained low relative to income growth and retail price increases were modest.

“The tax on tobacco for the 2012-2025 period is very low and had no impact on reducing consumption, while Vietnam’s per capita income has steadily increased every year,” Phan Thi Hai, deputy director of the Tobacco Harm Prevention Fund, was quoted as saying by Suc Khoe Doi Song, the official newspaper of Vietnam’s health ministry.

Vietnam has raised tobacco taxes twice since 2013, but officials said the increases had limited impact on smoking. The health ministry reported that Vietnam’s total tobacco tax burden is only 36.8% of retail prices, below the 70–75% recommended by the World Health Organization (WHO) and lower than some neighboring ASEAN countries cited by the ministry, including Thailand (78.6%) and Singapore (67.1%).

The tax change comes as Vietnam reviews additional tobacco control measures. On Jan. 13, the health ministry proposed amendments to the tobacco harm prevention law, including expanding smoke-free areas, tightening retail restrictions, increasing health warnings to cover 85% of cigarette packs, and strengthening advertising and marketing restrictions to limit youth access.

Vietnam’s health ministry estimates that smoking causes around 100,000 deaths annually, directly or indirectly, and reported that Vietnam had more than 15 million smokers in 2024, placing it among the world’s largest tobacco-consuming countries.