Enterprises support the reduction of environmental protection tax on gasoline

On the afternoon of March 23, the National Assembly Standing Committee considered and approved a Resolution on environmental protection tax rates for gasoline, oil and grease.

Specifically, the environmental protection tax on gasoline will be reduced by 50%, equivalent to 2,000 VND/liter. Diesel, fuel oil, lubricants and greases have similar reductions, from 2,000 VND to 1,000 VND/liter. The Resolution takes effect from April 1 to December 31, 2022.

In the context that the world petroleum market continues to be complicated, and the price of crude oil on the world market tends to increase, the reduction of environmental protection tax on this item is considered timely, contributing to support people and businesses.

According to the Ministry of Finance, it is expected that the consumption of gasoline, oil and grease this year will be equivalent to that of 2019, then the reduction of environmental protection tax as above will reduce revenue State budget about 31,930 billion VND for the whole year.

However, a decrease in gasoline prices will limit the increase in production costs, reduce product costs, support the recovery of people and businesses, and contribute to lowering the CPI.

“The reduction of environmental protection tax on gasoline, oil and grease will reduce the average CPI in 2022 by an estimated 0.76% – 0.85%. However, because the environmental protection tax is an absolute number, the CPI is is a relative number, so the impact of the reduction of environmental protection tax on CPI gradually decreases when gasoline prices continue to increase compared to the current; reduce CPI by 0.61% if gasoline prices increase by 10% compared to the current level,” said Mr. Ho Duc Phuc – Minister of Finance.

The National Assembly Standing Committee has considered and approved the Resolution on environmental protection tax rates for gasoline, oil and grease. Illustration.

A representative of the Vietnam Federation of Trade and Industry said that the reduction of environmental protection tax on gasoline not only helps businesses and people, but also contributes to reducing the negative impact of oil prices. gasoline increased sharply on economic recovery programs.

Mr. Dau Anh Tuan – Head of Legal Department, Vietnam Federation of Trade and Industry said: “We believe that an increased reduction can help business activities improve. From there, people and businesses pay taxes to the state budget. Vietnam is also a crude oil exporting country, so the additional revenue from the increase in gasoline prices is very large.”

For transport businesses, the tax reduction also partly supports their difficulties. Moreover, transportation is also the input of many other sectors, from industry, commerce to tourism.

“With this level of support, petrol costs will be reduced by 600,000 VND, contributing to making businesses less difficult, the life of drivers is also less difficult”, said Mr. Duong Tri Thanh – Deputy General Director of G7 Taxi said.

According to representatives of agencies of the National Assembly, in the long-term, it is possible to consider reducing other taxes such as import-export tax, special consumption tax, etc. At the same time, study the possibility of additional tools for the Stabilization Fund. petrol and oil prices in kind, in order to diversify regulatory tools and support the goal of stabilizing the market.

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