JavaScript is off. Please enable to view full site.

Vietnam proposes drastically increasing ‘environment tax’ on petrol

Vietnam proposes drastically increasing ‘environment tax’ on petrol

Wednesday, May 03, 2017, 19:09 GMT+7

The Vietnamese government is drafting an amendment to the law on environmental protection tax, which includes a proposal to more than double the current tax on gasoline.

The bill, prepared by the Ministry of Finance, suggests lifting the maximum environmental protection tax on gasoline to VND8,000 per liter from the current VND3,000.

Higher tax rates for other fuel products, such as diesel and fuel oil, are also proposed in the draft amendment.

The finance ministry is scheduled to collect feedback for the bill in April and submit a final draft to government in May.

The government will then officially present the bill to the lawmaking National Assembly in June, which will assign various committees to appraise the draft before deciding its fate in October.

The environmental protection tax is intended to solicit resources from the public and increase state revenue in order to resolve environmental issues, according to the finance ministry.

The ministry revealed that revenue from this kind of tax has steadily increased, from VND11,160 billion (US$498.21 million) in 2012 to VND42,393 billion ($1.89 billion) in 2016.

The tax accounted for 1.5 percent to 4.1 percent of the state’s total budget collection, making up 0.3 percent to 0.9 percent of the country’s GDP.

With the tax rate for gasoline likely to more than double later this year, local consumers are worried that fuel prices will soon skyrocket.

A92 gasoline, the country’s most widely used fuel, currently sells for VND17,310 a liter under the VND3,000 environment tax.

Should the new tax rate be applied, the price would rise to more than VND22,000 a liter, according to analysts.

However, Ngo Tri Long, a price management expert, has said that VND8,000 a liter is only the proposed ceiling tax rate for gasoline, and that the finance ministry does not necessarily have to immediately apply it after it is approved.

Even so, the proposed ceiling rate is so high that it will surely impact consumers and the market in general, Long added.

Several regulatory bodies, including the foreign and justice ministries and the Vietnam Chamber of Commerce and Industry have also expressed concerns about the negative impact the new tax rate will have on the economy.

Long therefore suggested that the finance ministry focus on measures to reduce tax losses in the fuel sector, at a time when the state’s budget is suffering huge losses from smuggled fuel.

More

Read more

;

Photos

VIDEOS

‘Taste of Australia’ gala dinner held in Ho Chi Minh City after 2-year hiatus

Taste of Australia Gala Reception has returned to the Park Hyatt Hotel in Ho Chi Minh City's District 1 after a two-year hiatus due to the COVID-19 pandemic

Vietnamese woman gives unconditional love to hundreds of adopted children

Despite her own immense hardship, she has taken in and cared for hundreds of orphans over the past three decades.

Vietnam’s Mekong Delta celebrates spring with ‘hat boi’ performances

The art form is so popular that it attracts people from all ages in the Mekong Delta

Vietnamese youngster travels back in time with clay miniatures

Each work is a scene caught by Dung and kept in his memories through his journeys across Vietnam

Latest news