50% reduction in registration fees for domestically produced cars from July 1st.

From July 1st until the end of this year, domestically assembled cars and trailers or semi-trailers will receive a 50% reduction in registration fees.

According to Decree 41 issued by the Government today, the initial registration fee for domestically manufactured and assembled automobiles, trailers or semi-trailers towed by automobiles, and similar vehicles will be reduced by 50% from July 1st to December 31st, 2023. From January 1st, 2024, this fee will revert to the previous rate.

In reality, reducing registration fees won't lower car prices but will reduce the overall costs of getting a car on the road. This reduction also aims to stimulate domestic car market demand amidst the difficulties faced by businesses in this sector.

According to the Vietnam Automobile Manufacturers Association (VAMA), sales in the industry have declined since the end of 2022 and have shown no signs of improvement in the first half of this year.

In the last two months of 2022, sales of businesses decreased by as much as 44% compared to the same period in 2021. As of April 2023, sales of VAMA members had fallen by approximately 34%, equivalent to 42,000 vehicles, compared to the same period last year. However, according to the Ministry of Finance , this fee reduction is unlikely to significantly boost car sales as in the 2020-2022 period due to the current decline in purchasing power and consumption. It is estimated that the reduction in registration fees will result in a budget deficit of approximately 8,000-9,000 billion VND.

Currently, vehicle registration fees for passenger cars are calculated as a percentage of the vehicle's value, depending on the type and location. For example, the initial registration fee for passenger cars in Hanoi , Quang Ninh, and Hai Phong is 12% of the vehicle's value; in Ho Chi Minh City it's 10%, and in Ha Tinh it's 11%... For pickup trucks, the registration fee is 60% of the initial fee for passenger cars.

From the second payment onwards, the vehicle registration fee is 2% and is applied uniformly nationwide.

Hoai Thu

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