Ministry of Finance mulls import tax on trucks

Illustrative image (Source: Internet)

There could be a 2 percent to 20 percent increase in import tax on various types of trucks, according to a circular drafted by the Ministry of Finance.

The proposal was listed in the draft circular on revising import tax on trucks and spare parts, which has been sent to other ministries and sectors for their suggestions.

Taxes levied on imported trucks are expected to be synchronously increased in the country, but still under the World Trade Organisation's ceiling level as Vietnam has committed.

In concrete terms, the finance ministry plans to raise the tax from 68 percent to 70 percent of value for trucks which are five tonnes and below. The trucks with a capacity between five tones and 10 tonnes may be levied import tax of 70 percent, from the current 50.

Trucks between 20 tonnes and 45 tonnes may be taxed between 25 percent and 35 percent, from the current 15 percent and 20 percent, respectively.

As for special-use vehicles including refrigerated lorries, waste collection trucks, tank trucks and cement tankers, there may be a 20 percent tax.

The finance ministry said the tax increase was aimed at supporting and encouraging domestic automakers to strengthen production and assembling of special-use vehicles.

In addition, the ministry has also proposed to apply preferential import tax on imported automobile spare parts.

The ministry's proposal originated from a petition made by the TMT Automobile Joint Stock Company, in which the company said domestic automakers, who had imported spare parts for assembling, had to bear various expenses for investment, production and assembling. In particular, expense for assembling a production line was high, with slow returns on investment.

In addition, the price of imported spare parts was higher than the complete built-up units (CBUs) due to strict requirements from the suppliers.

The company had proposed to the finance ministry to increase between 10 percent and 18 percent in import taxes on CBU trucks, depending on the capacity of each truck.

Statistics released by the Customs Office showed that Vietnam imported nearly 75,240 units from early this year to the end of August, which was 101.7 percent higher than the same period last year.

China was the largest supplier of CBUs for Vietnam in August, with nearly 18,900 units, a year-on-year increase of 167 percent.-VNA