Vietnam Plans Special Consumption Tax Cut on Automobile
The Ministry of Trade and Industry said they are considering cutting special consumption taxes on automobiles to cool down high prices in the local auto market, Labor newspaper reported Friday.
The move is expected to bring in more choices for local consumers in compliance with the country's WTO commitments, noted a ministerial official, adding that domestic businesses now produce only simple automobile parts that to blamed for the current car shortage.
Currently, local companies only produce from 5 per cent to 10 per cent of the car parts, most of which are of low value.
Local experts warned of adverse impacts on traffic infrastructure, environment and local automobile business operations, which, in turn, may hamper foreign investments.
The General Statistic Office figured out that in the past eleven months, the country imported US$1.197 billion worth of car and car parts, including 22,000 units valued at US$438 million, up 89.6 per cent, 96 per cent and 126 per cent on year, respectively.
According to Vietnam Automobile Manufacturers Association (VAMA) its 17 member carmakers car sales rose to 58,320 units in the first ten months, up 88 per cent on year, the 15th straight month of increase.
Automobile in Vietnam are subjected to 50 per cent of special consumption tax, 60 per cent of import tax and 10 per cent of value added tax, they said, noting that these expenditure normally accounts for 50 per cent of the total prices. (Labour)
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