Special Consumption Tax on On-Premise Mixed Beverages (Fresh Pepsi, Fresh 7Up) at Cinemas
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This explanation was generated by AI and checked by an automated AI review, not by a human expert. It is not legal, tax or accounting advice and may contain errors. Check the official document before you rely on it.
Nghe An Tax Department provides guidance on whether on-premise mixed beverages (Fresh Pepsi, Fresh 7Up) are subject to special consumption tax (SCT) under the Law on Special Consumption Tax 2025. Under Clause 4, Article 3 of Decree No. 360/2025/ND-CP dated 31/12/2025, soft drinks subject to SCT must satisfy two conditions: (1) they must be a ready-to-drink product manufactured according to Vietnam national standard TCVN 12828:2019 on soft drinks, and (2) they must have sugar content exceeding 5g/100mL. On-premise beverages mixed to order at the counter (using sugar, milk, canned fruit ingredients, carbonated water, etc.) are NOT subject to SCT if they do not qualify as a ready-to-drink product under TCVN 12828:2019 or do not have sugar content exceeding 5g/100mL. Businesses must assess each specific case to determine their SCT declaration and payment obligations.
Question
A cinema sells on-premise mixed beverages (Fresh Pepsi, Fresh 7Up) - beverages mixed from syrup, CO2, and water according to a formula provided by supplier Suntory PepsiCo Vietnam. After mixing per the instructed ratio, total sugar content exceeds 5g/100mL. Question: are these products subject to special consumption tax (SCT)?
Official guidance
Nghe An Tax Department, citing Clause 4, Article 3 of Decree No. 360/2025/ND-CP dated 31/12/2025 of the Government detailing the implementation of the Law on Special Consumption Tax, provides the following guidance:
Conditions for SCT liability on soft drinks:
Soft drinks are subject to SCT only when they simultaneously satisfy:
- The product is a soft drink under Vietnam national standard TCVN 12828:2019; and
- Sugar content exceeds 5g/100mL (sugar content is calculated as total sugar printed on the product label per Ministry of Health regulations).
Under TCVN 12828:2019, soft drinks (nuoc giai khat) are ready-to-drink products manufactured from water, which may contain sugar, food additives, flavourings, vitamins, and minerals. The standard does not apply to certain products such as milk and dairy products, natural mineral water and bottled drinking water, fruit/vegetable juice and nectar, etc.
Conclusion on on-premise mixed beverages:
On-premise beverages mixed to order at the counter (using sugar, milk, canned fruit ingredients, carbonated water, etc.) are NOT subject to SCT if they do not qualify as a "ready-to-drink product" under the soft drink definition in TCVN 12828:2019 or do not have sugar content exceeding 5g/100mL.
If a taxpayer pre-mixes beverages that constitute a soft drink product under TCVN 12828:2019 with sugar content exceeding 5g/100mL, those products ARE subject to SCT. The business must declare and pay SCT in accordance with the Law on Special Consumption Tax 2025.
Action points
- Determine whether the on-premise mixed beverage qualifies as a "ready-to-drink product" under TCVN 12828:2019.
- Verify actual sugar content after mixing (whether it exceeds 5g/100mL).
- If both conditions are met: declare and pay SCT under the Law on Special Consumption Tax 2025.
- If either condition is not met: no SCT declaration is required for these products.