High taxes will reduce car sales
At the 7th Conference of full-time National Assembly deputies, National Assembly deputy Nguyen Thi Viet Nga ( Hai Duong ) proposed studying the increase in special consumption tax on double-cabin pickup trucks according to the roadmap.
According to the delegate, the double-cabin pick-up truck is a vehicle line used mainly outside urban areas, with the main function of transporting goods, used by many households and many units to serve small and medium-sized businesses, convenient and simple in transportation. "Pick-up" in Vietnamese is a light truck or pickup truck used for diverse purposes, commuting to work combined with transporting agricultural tools and other goods. This vehicle line is suitable for the priority product group according to Decision No. 1168/QD-TTg of the Prime Minister " approving the Strategy for the development of the Vietnamese automobile industry to 2025, with a vision to 2035" which is: Focusing on developing a line of multi-purpose small trucks serving agricultural and rural production.
According to the current Law on Special Consumption Tax, double-cabin pickup trucks are subject to a special consumption tax rate of 15-25%. If the special consumption tax increase is applied as in the draft Law, the tax rate will be 60% of the tax rate applied to passenger cars with the same cylinder capacity, which means it can increase by at least 9% or double in some cases.
“Increasing the tax rate at once will affect customer psychology, reduce car consumption, leading to a decrease in sales of this car line, causing hundreds of people to lose their jobs, reducing state budget revenue from related tax lines such as import tax, registration fee, license plate fee, value added tax of domestically produced and imported cars,” delegate Nguyen Thi Viet Nga stated.
Based on the recommendations of voters and businesses in Hai Duong province, on the basis of fully and thoroughly considering the wishes of businesses, protecting the interests of consumers, ensuring budget revenue, employment for workers, and socio-economic development, delegate Nguyen Thi Viet Nga proposed that the National Assembly consider a roadmap to increase the special consumption tax rate on double-cabin pickup trucks within 3 years, from 2027 to 2030. The additional increase of 3%/year is equivalent to dividing the increase by 9% over 3 years, applied from 2027, instead of increasing 9% to more than 20% at once as at present.
Essential goods but still have to be regulated
Concerned about the subject of special consumption tax on gasoline of all kinds, National Assembly delegate Nguyen Truong Giang (Dak Nong) said that gasoline is an essential commodity and cannot be restricted in use. Meanwhile, gasoline is subject to both special consumption tax and environmental protection tax. Is that true in nature? The delegate suggested that if gasoline is determined to have an impact on the environment, then increase the environmental protection tax, not impose special consumption tax on gasoline.
Similarly, the taxable object is air conditioners with a capacity of 90,000 BTU or less, this is also an essential item. Delegate Nguyen Truong Giang proposed not to tax this item.
National Assembly Representative Hoang Van Cuong (Hanoi) said that the goal of special consumption tax is to change consumer behavior to limit the consumption of products that are harmful to health or have negative impacts on the community so that consumers have to switch to a more beneficial alternative consumer product. Meanwhile, air conditioners with a capacity of 90,000 BTU or less are popular consumer products and have no substitute. No matter how high the tax is, people still have to use air conditioners. Therefore, it is not advisable to stipulate that air conditioners with a capacity of 90,000 BTU or less are subject to special consumption tax.
Explaining at the Conference, Deputy Minister of Finance Cao Anh Tuan stated that air conditioners are no longer a luxury item, but we still have to regulate and adjust consumer behavior with this item. With many opinions saying that for common, popular air conditioners that all families must use, the Government is researching, reviewing and having a plan to tax air conditioners from over 18,000 BTU to under 90,000 BTU.
As for gasoline of all kinds, this is an item subject to special consumption tax since 1995, for 30 years now. Countries such as France, Germany, Italy, UK, South Korea, Australia, Thailand, Singapore, China, Cambodia, and Laos still collect environmental protection tax and special consumption tax on this item.
“We collect special consumption tax on gasoline, but with bio-fuels such as E5, E10 mixed at the respective ratios of 95%, 90%, Ron 92 gasoline is 5%, 10% bio-ethanol is reduced to E5 at 8%, E10 at 7%, lower than mineral gasoline at 10% to encourage the use of bio-fuels,” said Deputy Minister Cao Anh Tuan.
Regarding the idea of suddenly increasing tax on double-cabin pickup trucks, through the opinions of delegates, Deputy Minister Cao Anh Tuan also said that he is researching and proposing a plan to increase tax in 3 years, accordingly equal to 50%, 55%, 60% of the tax rate of gasoline vehicles corresponding to each type.
“Specifically, for vehicles with a displacement of 1,500cc or less, currently the tax rate for pick-up trucks is 15%, and for gasoline vehicles it is 35%; the first year of implementing the special consumption tax on pick-up trucks is 17.5%, the second year is 19.25% and the third year is 21%, an increase at a certain level and also appropriate,” Deputy Minister Cao Anh Tuan emphasized.
Source: https://daibieunhandan.vn/can-nhac-tang-thue-doi-voi-xe-o-to-pick-up-cho-hang-cabin-kep-theo-lo-trinh-post408514.html
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