HCMC – The Ministry of Finance has proposed reducing the environmental protection tax by VND500-1,000 on each liter of fuel until the end of this year to absorb the fuel price surge.
The ministry has announced a draft resolution on adjusting the environmental protection tax on fuel, except aviation fuel. Related agencies are requested to give feedback on the resolution no later than March 4.
The ministry proposed cutting the environmental protection tax from VND4,000 to VND3,000 per liter for gasoline, except ethanol, and from VND2,000 to VND1,500 per liter or kilogram for diesel oil, heavy fuel and lubricating oil.
Besides, the environmental protection tax would be halved from VND1,000 to VND500 per liter for kerosene, and from VND2,000 to VND1,500 for lubricant grease.
According to the Finance Ministry, if the tax cut is applied from April 1 until the end of this year, the State budget would lose some VND12 trillion, including value-added tax.
However, the ministry said fuel is the input of most industries, so cutting the environmental protection tax on fuel will help reduce production costs.
The local retail price of RON95 gasoline on March 1 rose by VND550 to VND26,830 per liter, the highest ever.
Other fuels were also adjusted up, with the bio-fuel E5 RON92 revised up by VND540 to VND26,070 per liter.
The prices of kerosene and diesel oil are VND19,970 and VND21,310 per liter, up VND470 and VND510 per liter, respectively. Heavy fuel oil is priced at VND18,460 per kilogram, up VND530.
This is the sixth time in a row that domestic fuel prices have been hiked since mid-December 2021, as the ongoing military conflict between Russia and Ukraine has fueled an oil price surge.