The Ministry of Finance (MoF) have no plans to raise the import tax on cars, Nguyen Van Phung, Deputy Director of the Tax Policy Department under the ministry affirmed, saying that the currently applied tax rate is reasonable.
In the medium and long term, the import tax policy will play an important role in protecting local production and creating sources of income for the state budget, Phung said.
He added that the policy, in the short term, can help control imports and exports – a way to intervene in the market.
March 11 and April 17, the ministry raised car import tax rates from 60 per cent to 70 per cent and 83 per cent in an effort to help implement the government’s measures to curb inflation.
Rumor has it that MoF will further raise the tax to 94 per cent in the time to come to help restrain inflation.
Phung said that any tax adjustments in the future will have to come in accordance with WTO and ASEAN commitments.
Under its WTO commitments, Vietnam has to slash the tax to 70 per cent within seven years after the day it joined the WTO (2014).
As for passenger vehicles with the cylinder capacities of 2.5L and higher, the tax rate must be cut from 90 per cent, which it was at the time Vietnam joined the WTO, to 52 per cent by 2019.
Meanwhile, the tax rate for 4WD vehicles must be reduced more rapidly to 47 per cent by 2017.
However, in order to prevent trade fraud and make it easier for management, all people-carrying vehicles will bear the same tax rate of 47 per cent by 2017.
Under CEPT/AFTA, the tax cut process will be carried out more rapidly. Cars for carrying people with more than 10 seats and trucks both began enjoying the low tax of 5 per cent in 2006. Meanwhile, the tax rate on vehicles for carrying people with less than nine seats will be cut to 0 per cent by 2018.
“The tax policy will bring more choices for customers: imports from ASEAN countries have low prices and low taxes while imports from Europe have high prices and high taxes,” Phung said.
Phung agreed with the opinion that the government needs to make public the roadmap on car tax cuts for people’s consideration.
“This is a legitimate requirement. We will have to state how many percent the tax rate will be for this year or the next year,” he said. (VnMedia)
Vietnamese
