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Vietnam: Key lawmakers okay further tax cut on petrol, effective as of July 11
The National Assembly Standing Committee, at its extraordinary session on July 6, approved the Government’s proposal on additional environmental protection tax cuts on petrol and oil in an attempt to cool down the domestic fuel market.
Under the approved resolution, the environmental protection tax on petrol and diesel oil will be further axed in half to the floor level of VND1,000/litre and VND500/litre respectively.
Meanwhile, the tax on jet fuel will be trimmed by a further VND500/litre to VND1,000/litre, and on mazut oil, lubricants and grease by a further VND700/litre to the floor level of VND300/litre.
The tax rate of VND300/litre on kerosene remains unchanged.
The resolution is scheduled to come into effect as of July 11.
The National Assembly also requested that the Government consider adjusting the excise tax and value added tax on petrol and oil if the global oil market keeps fluctuating that hampers the government’s inflation control efforts and negatively impacts business production and people’s life.
A week ago, the Ministry of Finance submitted a proposal to the Prime Minister in a bid to reduce the excise tax and value added tax, in addition to the environmental protection tax, as it seeks control rising petrol prices.
Since April, Vietnam has halved the environmental protection tax placed on petrol and oil by VND2,000 and VND1,000 per litre, respectively.
However, retail petrol and oil prices have continued to climb, forcing policymakers to consider a further environmental protection tax cut.
Some economic experts say that such tax cuts will not help much, and lowering the excise tax and value added tax will be more positive move.
According to experts, taxes make up more than 30% of the retail price of a litre of petrol. Among them are the 10% import tax, the 10% excise tax, and the 10% value added tax.
At present, the price of petrol RON95 is capped at VND32,760/kitre, while that of petrol E5 RON92 is traded at VND30,890/litre.
Source: VOV