VCCI proposes to remove special consumption tax on gasoline

The Vietnam Chamber of Commerce and Industry (VCCI) continues to propose that the drafting agency of the Law on Special Consumption Tax (amended) consider abolishing the special consumption tax on gasoline, as it is not a luxury item.

The Vietnam Chamber of Commerce and Industry (VCCI) has suggested that the Ministry of Finance should abolish the special consumption tax on gasoline.

The Vietnam Chamber of Commerce and Industry (VCCI) has recently sent a document to the Ministry of Finance providing feedback on the draft Law on Special Consumption Tax (amended). In it, the VCCI suggested that the drafting agency consider abolishing the special consumption tax on gasoline.

The Vietnam Chamber of Commerce and Industry (VCCI) argues that gasoline is simultaneously subject to two types of taxes that restrict consumption: excise tax and environmental protection tax.

" Gasoline is not a luxury item, so imposing an excise tax on it also contributes to environmental protection. Therefore, we suggest that the drafting agency consider abolishing this tax on domestic fuel. If necessary, authorities can adjust the environmental protection tax to align with the objectives of this tax," VCCI commented.

Currently, the excise tax rates applied to gasoline are 10%, E5 gasoline 8%, and E10 gasoline 7%; diesel is not subject to this tax.

RON 95-III gasoline is currently priced at 22,880 VND, and diesel at 20,320 VND. Therefore, each liter of gasoline currently includes over 2,000 VND in special consumption tax (price before VAT).

At the same time, each liter of gasoline sold is also subject to an environmental protection tax of 2,000 VND, E5 gasoline is 1,900 VND, and diesel is 1,000 VND.

The Vietnam Chamber of Commerce and Industry (VCCI) has repeatedly proposed abolishing the excise tax on gasoline. However, the Ministry of Finance maintains that the excise tax on gasoline is appropriate and cannot be abolished in the context of combating climate change and the commitment to reducing net emissions to zero by 2050.

Each year, Vietnam consumes approximately 25-26 million cubic meters/tons of various types of petroleum products. According to data from the Ministry of Industry and Trade , in the first half of this year, the country consumed about 13.2 million cubic meters/tons of petroleum products, a slight decrease compared to the first six months of 2023.

In addition to the above proposal, VCCI also has a proposal related to excise tax on tobacco, sugary drinks, and beer and wine. The organization stated that it and businesses agree on the view that excise tax policy should be used to protect public health and limit the consumption of products harmful to health such as alcohol and tobacco.

"However, we suggest that the drafting agency research and propose a tax increase roadmap for alcohol and tobacco that is more in line with the business situation of enterprises, prioritizing an option with a more stable tax increase rate. At the same time, consider the impact of including soft drinks under the 10% tax," VCCI proposed.

Source: https://baodautu.vn/vcci-de-xuat-bo-thue-tieu-thu-dac-biet-doi-voi--xang-d220898.html