Should continue to reduce, defer taxes

Need to reduce taxes import

From the beginning of the year until now, gas price retail sales increased 8 times, to a record high, bringing the retail price to nearly 30,000 VND/liter. In the context of struggling to recover from COVID-19, the excessive and prolonged increase in gasoline prices once again caused difficulties for people, businesses and the whole economy.

Economist Ngo Tri Long said that the Ministry of Finance’s proposal to reduce the preferential import tax (MFN tax) on motor gasoline, unleaded from the current 20% to 12% will contribute to diversifying the economy. supply, contributing to the reduction of domestic gasoline prices.

According to Mr. Long, in addition to reducing import tax, one of the taxes on petroleum products that can be reduced is the Special Consumption Tax. However, if the Special Consumption Tax is reduced, the state budget revenue will decrease in the short term, but the whole economy will benefit in the long run.

In the context of a sharp increase in gasoline prices due to dependence on the world market, in addition to support measures from the State, enterprises themselves must find ways to save, thereby reducing costs, “said Mr. Long. .

In the draft Decree on preferential import and export tariffs, the Ministry of Finance said that recent developments show that the world petroleum market will have many unpredictable and unpredictable changes, with potential hidden risks affecting the petroleum supply of Vietnam.

The reduction of MFN tax will contribute to diversifying petroleum supplies from other countries such as China, the US and countries in the Middle East, avoiding too much dependence on a few partners like now in the case of supply in the world market fluctuates.

At the same time, the difference of 4% between the MFN tax rate and the Free Trade Agreement tax rate (FTA) for gasoline is also reasonable to promote domestic enterprises to seek new sources of petroleum in case of There is a shortage of petroleum supply from traditional markets.

According to the Tax Policy Department (Ministry of Finance), gasoline is subject to the following taxes: Import (for imported gasoline), Special Consumption Tax (collected only for gasoline), Environmental Protection Tax (for environmental protection). ) and Value Added Tax. The Law on Fees and Charges does not stipulate the collection of fees and charges for petroleum products.

“Compared to many countries in the world, the proportion of tax in the selling price of petrol and oil in Vietnam is still lower than the general average, especially after the environmental protection tax rate was adjusted down according to the Resolution of the Standing Committee of the Standing Committee. National Assembly”, said a representative of the Tax Policy Department.

Petroleum stabilization fund negative nearly 170 billion

As one of the tools to help “stop” the increase in gasoline prices, the Petroleum Price Stabilization Fund (BOG Fund) was almost “exhausted” when it was at a negative level of nearly 170 billion dong.

According to the Ministry of Finance, by the end of the first quarter of 2022, the BOG Fund was negative 169.9 billion dong. In the first quarter of 2022, the total amount deducted from the BOG Fund is 601.7 billion VND and the total use of the fund is 1,671.4 billion VND. This is the third time the BOG Fund has gone negative.

Most recently, in October 2021, the BOG Fund at 15 major petroleum companies is experiencing a negative of approximately VND 1,500 billion due to fund deductions to maintain domestic retail prices.

Reduce taxes and fees will better support businesses

Dr. Le Dang Doanh, former director of the Central Institute for Economic Management, assessed that the high gasoline prices caused difficulties for businesses. Gasoline prices lead to increased transportation costs, especially for exporters. This makes the cost of goods increase, making it difficult for businesses to compete.

In addition to the policy of reducing gasoline prices, authorities need to focus on solutions such as reducing taxes and fees to help businesses overcome difficulties. Mr. Doanh noted that price interventions can distort the market, potentially leading to consequences such as smuggling when the domestic gasoline price is lower than the world price.

In addition, businesses need more solutions to reduce road transport costs, switch to river transport, rail transport…

According to economist Dinh Trong Thinh, the reduction in gasoline prices helps businesses overcome a difficult period, when the economy has not yet recovered from COVID-19. However, in the market economy, we have to accept the price of gasoline up and down according to the market. The state cannot interfere with prices by administrative means.

“The state seeks to reduce taxes and fees, which will help reduce gasoline prices, creating favorable conditions for businesses. But enterprises themselves also have to make efforts to overcome the difficult period, but cannot wait forever from the State, “said Mr. Thinh.