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Friday, July 19, 2024

Excise tax abolition proposal for gasoline rejected

The Saigon Times

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HCMC – The Ministry of Finance has rejected a proposal to drop the special consumption tax on gasoline, saying the tax rate is not high and adding that the issue is beyond the ministry’s authority.

The special consumption tax rate on gasoline in Vietnam is currently far lower than that of neighboring countries such as Laos, Cambodia and China, the Ministry of Finance said, explaining its decision.

The special consumption tax, or the excise tax, is 10% for gasoline, 8% for gasoline E5 and 7% for gasoline E10.

Additionally, the Law on Special Consumption Tax does not prescribe any conditions for exemption or reduction of the excise tax on goods and products subject to the tax.

The ministry’s decision was in response to a proposal to exempt oil products from the tax made by the Vietnam Chamber of Commerce and Industry.

The ministry also clarified that the adjustment of the special consumption tax is under the authority of the National Assembly. Thus, the proposal must be submitted to the National Assembly, not the ministry, for consideration.

Moreover, the ministry considered gasoline a non-renewable resource that needs to be used wisely and sparingly. That means it is reasonable to impose a special consumption tax on gasoline.

According to the draft resolution of the National Assembly, the special consumption tax and value-added tax on fuels will be reduced by 50% at the maximum.

The National Assembly Standing Committee will determine the specific reduction of the special consumption tax on gasoline and the value-added tax on fuels, as well as the time of application amid the global fuel price fluctuations.

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