Extended payable excise tax will help boost domestic automobiles

The Ministry of Finance (MoF)’s proposal to extend the deadline for excise tax payment for locally manufactured and assemble cars will help businesses get more financial resources and restore their production, according to Dinh Trong Thinh, a senior lecturer at the Finance Institute.

Mazda vehicles are being checked before rolling out of the factory at Truong Hai Automobile JSC in Chu Lai Open Economic Zone, Quang Nam province. Extending the deadline for excise tax payment for domestic cars will help boost local car manufacturers and assemblers. (Photo: VNA)

Hanoi (VNS/VNA) - The Ministry of Finance (MoF)’s proposal to extend thedeadline for excise tax payment for locally manufactured and assembled cars willhelp businesses get more financial resources and restore their production,according to Dinh Trong Thinh, a senior lecturer at the Finance Institute.

TheGovernment’s Decree No 32/2022/ND-CP, dated May 21, 2022, extends thedeadline for payment of excise tax on domestically produced and assembled cars.

Accordingto industry insiders, the locally-made and assembled autoindustries have suffered from the pandemic and require support fromthe Government.

Thinhsaid that the deadline extension will last until this year. In the long run, itis necessary to extend the deadline further. In addition, the Finance Ministryalso needs to implement Decree No 32’s regulations soon effectively.

Ministerof Finance Ho Duc Phoc said the ministry always listens tobusiness opinions to continue advising the Government. The Government andthe National Assembly will conduct more realistic and effective policies toremove obstacles and help companies develop sustainably.

Thedecree takes effect from the date of issuance until late December 31, 2022.Once the extended deadline expires, excise tax payment on domestic carsshall revert to normal.

Thisis the third extension of excise tax compliance due date for local automobilessince 2020, with an amount equivalent to a tax break of 20 trillionVND (863 million USD).

Themove is part of the Government’s Decree No 32. The time limit for paying thepayable excise tax arising in June to September is no later than November 20,2022.

Previously,the Finance Ministry made a 50 percent cut in the registration fee forlocally-produced vehicles. Such support, along with this latest policy, isconsidered an urgent solution for the local car industry to recover from thesevere impact of the pandemic.

Accordingto the Finance Ministry, turnover from an excise tax ondomestically-manufactured vehicles is estimated at 2.45-2.8 trillion VND (107-122million USD) per month. Assuming growing demand for electric vehicles, theministry expects a decline of 2-3 trillion VND (87-130 million USD) inState budget revenue or a drop of 170-250 billion VND per month.

Accordingto the ministry, businesses eligible for a delay in excise tax paymentdeadline can either send the request directly online or print copies tothe tax authorities.

Thetotal excise tax amount subject to relief in October and November of 2021 stoodat 5.44 trillion VND (237 million USD)./.

VNA