Expected to extend 20 trillion dong of special consumption tax on domestically produced cars

According to the plan just submitted to the Government, the Ministry of Finance proposed to extend the payment of excise tax of the tax period from June to September this year. No later than November 20, enterprises must fully pay this extended tax amount.

In recent years, data from the Ministry of Finance shows that the average amount of special consumption tax paid by domestic automobile manufacturing and assembling enterprises ranges from 2,450 to 2,800 billion VND per month. In the scenario where the demand for electric vehicles increases thanks to the reduction of excise tax on battery electric vehicles, the estimated tax amount collected each month this year is about 2,000 billion VND. Businesses are entitled to late payment of excise tax of the tax period June, July, August, September until the end of November 20. With the total extension period of 10 months, the total amount to be extended is VND 20,000 billion.

Because this is an urgent solution that needs to be issued immediately to promptly support businesses, the Ministry of Finance asked the Government to allow the decree to take effect from the date of signing.

Thus, if approved, the special consumption tax reduction policy for domestically manufactured or assembled cars will be applied continuously for 3 years, from 2020 to now.

According to the Ministry of Finance, the sales activities of enterprises were negatively affected in the period from June to September last year due to the implementation of anti-epidemic decisions. The car factories of some manufacturers were also affected because of the lack of chips and assembled components due to the disruption of the global supply chain. 2021 is the year the Vietnamese auto market goes through many ups and downs and still needs the support of the State.

The extension of tax payment for domestically manufactured and assembled cars is not consistent with international commitments to which Vietnam has joined. However, the Ministry of Finance assessed this policy as necessary to create conditions to help businesses overcome difficulties.

Not only Vietnam, many other countries have also applied measures to support the domestic manufacturing industry during the epidemic period. The extension does not last long, so the possibility of being sued, according to the assessment department, is not high, because the lawsuit is only aimed at terminating the measures being applied, not a measure that has already ended.

Quynh Trang