Several types of vehicles will enjoy import tariff cuts beginning next year in line with Vietnam's commitment to the World Trade Organisation (WTO) on tax reduction.
According to the Ministry of Finance, which drafted the plan, all tariff cuts will take effect on January 1, 2015. It said the tax on four-wheel drive (4WD) vehicles would be reduced from 70 percent to 59 percent while the import tax on trucks with a loading capacity of less than five tonnes would be reduced from 59 percent to 56 percent.
The tax on motor homes, or self-propelled recreational vehicles which offer living accommodation, and on cars with less than 10 seats and an engine capacity of less than 2.5 litres, will be cut from 67 percent to 64 percent. The tariff on motorcycles, sidecars and mopeds will also be reduced from 47 percent to 40 percent.
Meanwhile, ASEAN members' auto imports are already receiving a preferential 50 percent import tariff since early 2014 as a result of the ASEAN Trade in Goods Agreement (ATIGA). In addition, under commitments to the ASEAN, auto import taxes in 2018 will be completely abolished.
ASEAN will waive taxes on car imports between ASEAN member countries, as well as from Japan, the Republic of Korea and China, who are all party to the agreement.
The tax cut poses a serious threat to the country's auto industry, which is expected to compete with the price and quality of imports.
According to the General Office of Statistic, Vietnam imported 44,000 cars in the first nine months of this year worth 938 million USD, a 74 per-cent increase in quantity and a 90.2 percent increase in value year-on-year.-VNA
According to the Ministry of Finance, which drafted the plan, all tariff cuts will take effect on January 1, 2015. It said the tax on four-wheel drive (4WD) vehicles would be reduced from 70 percent to 59 percent while the import tax on trucks with a loading capacity of less than five tonnes would be reduced from 59 percent to 56 percent.
The tax on motor homes, or self-propelled recreational vehicles which offer living accommodation, and on cars with less than 10 seats and an engine capacity of less than 2.5 litres, will be cut from 67 percent to 64 percent. The tariff on motorcycles, sidecars and mopeds will also be reduced from 47 percent to 40 percent.
Meanwhile, ASEAN members' auto imports are already receiving a preferential 50 percent import tariff since early 2014 as a result of the ASEAN Trade in Goods Agreement (ATIGA). In addition, under commitments to the ASEAN, auto import taxes in 2018 will be completely abolished.
ASEAN will waive taxes on car imports between ASEAN member countries, as well as from Japan, the Republic of Korea and China, who are all party to the agreement.
The tax cut poses a serious threat to the country's auto industry, which is expected to compete with the price and quality of imports.
According to the General Office of Statistic, Vietnam imported 44,000 cars in the first nine months of this year worth 938 million USD, a 74 per-cent increase in quantity and a 90.2 percent increase in value year-on-year.-VNA
