Vietnam’s lawmaking National Assembly has agreed to lower the environment tax on fuel by half, starting April, amid surging gasoline prices in Vietnam and across the world.
During a meeting on Wednesday, the National Assembly Standing Committee passed a resolution to reduce the environment tax on fuel based on a proposal from the government.
The resolution, which will take effect from April 1 to December 31, declared that the environment tax on gasoline, diesel fuel, and lubricants will be cut in half to VND2,000 ($0.08) per liter and VND1,000 ($0.04) per liter, respectively.
Tax on kerosene will decrease to VND300 from the current VND1,000 per liter.
In the proposal, the government stated that petroleum is both a strategic and essential commodity that has a strong impact on the operations of businesses and the lives of local residents.
Lowering environmental protection tax on gasoline, oil, and grease is a suitable and necessary solution at the moment.
The tax cut will directly contribute to the reduction of retail prices, thereby limiting the increase in production costs, lowering product prices, and stabilizing inflation.
The calculation by the Ministry of Finance showed that tax revenue in the country would be reduced by VND29 trillion ($1.26 billion) this year with this new tax rate.
Oil and gas prices in Vietnam climbed to an all-time high on March 11 after the Ministry of Finance and the Ministry of Industry and Trade had adjusted them upward seven consecutive times.
The prices dropped scantily following a regular adjustment on March 21.
E5RON92 gasoline is currently at VND28,330 ($1.24) a liter, while RON95-III at VND29,190 ($1.28) per liter.