Ministry of Finance proposes raising environmental protection taxes on oil and petroleum products from 3,000 VND (13 US cents) to the ceiling level of 4,000 VND (Source: xangdau.net) Hanoi (VNA) - The Ministry of Finance has proposed raising environmentalprotection taxes on oil and petroleum products from the current 3,000 VND (13US cents) to the ceiling level of 4,000 VND (17 cents) per litre beginning July1, 2018.
Accordingly,environmental protection taxes have been proposed to increase by 500 VND perliter of diesel oil to 2,000 VND and by 1,100 VND per liter of other oilproducts to 2,000 VND.
Plasticbags are also expected to see higher environmental taxes, rising from thecurrent 30,000 VND to 50,000 VND per kilo, if the proposal is approved.
Last year,the ministry sought opinions about a draft law on the environmental protectiontax hike to the highest level of 8,000 VND per litre. The proposal faced fierceopposition from both the public and economists.
In 2014, a similar hike was imposed, raisingthe taxes from 1,000 VND to 3,000 VND, which the ministry referred to as a goodway to stabilise the State budget.
The ministry said that the tax hike was necessary becauseimport taxes on oil and petroleum products are declining sharply.
It added that petroleum is usedin products containing chemicals, causing negative effects upon theenvironment, even when not in use. The current import tax on petroleumproducts is 20 percent, and 7 percent on oil products, and the respective rateswill be slashed to 10 percent and zero percent as part of Vietnam’s tax cutcommitments.
With the tax cut, revenues from petrol importshave been continuously decreasing in the past few years, as importers were keenon markets with more preferential tariffs. Inaddition, retail prices of oil and petroleum products in Vietnam are now lowerthan those in neighbouring countries and other Southeast Asian nations, theministry noted.
According to the ranking of the Global Petrol Prices on November27, 2017, Vietnam’spetrol retail selling price took 45th position among 167 countries and territories.
Theministry said the environmental protection tax increase is in line with regulationsunder the Law on Environmental Protection Tax, adding that the hike would haveeffects on selling prices of other products. However, it would encouragesavings of energies and natural resources, as well as consumption ofenvironmentally friendly products, such as E5 bio-fuel. This could help Vietnamreduce emissions, contributing to implementation of its internationalcommitments on environmental protection.
InJanuary, Vietnam imported 900,000 tonnes of various kinds of oil and petroleumproducts, totaling 552 million USD, marking respective rises of 3.5 percent and10.8 percent, according to the General Statistics Office.
The current law on environmental protectiontaxes, issued in 2012, stipulates that products such as oil, gas, grease, coal,and plastic bags are subject to these types of taxes.-VNA
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