Reduced to 10% import tax on gasoline
The government agreed to halve the preferential import tax rate (MFN) on gasoline, to 10% from August 8.
This content is stated in Decree 51/2022 amending the preferential import tax on gasoline. Accordingly, the preferential import tax rate (MFN) for motor gasoline, unleaded will be halved, from 20% to 10%. This reduction was made by the competent authority on the basis of the proposal of the Ministry of Finance last month.
Preferential import tax (MFN) is a tax applied to goods imported from countries and territories that have performed most-favored-nation treatment in relations with Vietnam.
In fact, reducing the MFN tax by 10% on motor gasoline and unleaded gasoline does not help much to reduce gasoline prices, because the proportion of imports from these taxing countries currently accounts for a negligible amount of the total gasoline consumed in the country. .
But this tax reduction will contribute to diversifying supplies from other countries such as China, the US and countries in the Middle East. This helps to avoid too much dependence on a few partners like now if the supply in the world market fluctuates.
According to the Ministry of Finance, the proportion of tax in the base price of petroleum in Vietnam is still lower than the average rate of many countries. For example, the tax in the price of gasoline in many countries currently ranges from 40-55%, oil is 35-50%, except for some countries with large oil reserves where the proportion is lower.
Petrol prices, after increasing continuously since the beginning of the year, have had 4 consecutive declines, with a decrease of more than 6,500 VND per liter, but essential goods and services have not decreased accordingly. In early August, the Prime Minister asked ministers and chairmen of People’s Committees of provinces and cities to jointly review and control the prices of goods and services to prevent hoarding, speculation and unreasonable price increases.
In Vietnam, after 2 reductions of environmental protection tax in April and July, currently the tax in gasoline price accounts for about 19.4-22% (for gasoline E5 RON 92 or RON 95-III) and 11.05% (for gasoline E5 RON 92 or RON 95-III) with diesel oil).
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