Reducing environmental protection tax, how will gasoline prices decrease?
This afternoon (March 23), the National Assembly Standing Committee approved a resolution on environmental protection tax rates for gasoline, oil and grease until the end of December 31, 2022.
According to the Resolution, from 1/4 the environmental protection tax on gasoline will be reduced by 2,000 VND/liter, from 4,000 VND/liter to 2,000 VND/liter. In addition, the environmental protection tax on diesel, fuel oil and lubricants will be reduced by 1,000 VND/liter, from 2,000 VND/liter to 1,000 VND/liter. Lubricant reduced by 1,000 VND/kg, from 2,000 VND/kg to 1,000 VND/kg. Kerosene decreased by 700 VND/liter, from 1,000 VND/liter to the floor level of 300 VND/liter. Flight fuel kept at the current level is being reduced by 1,500 VND/liter.
The Resolution takes effect from April 1, 2022 to the end of December 31, 2022. After December 31, 2022, the environmental protection tax on gasoline and oil will return to the applicable level, which is 3,800 – 4,000 VND for gasoline, 2,000 VND per liter for oil.
The halving of environmental protection tax will help reduce domestic gasoline and oil prices in the near future
Regarding the impact of the Resolution on domestic gasoline prices, according to the Government’s report, the reduction of environmental protection tax rates on gasoline, oil and grease as proposed will contribute directly to reducing the retail price of gasoline. , oil, grease (including VAT) is 2,200 VND/liter for gasoline, respectively; VND 1,100/liter for diesel oil, fuel oil, lubricant oil; 1,100 VND/kg for grease; 770 VND/liter for kerosene.
Regarding the impact on the budget, the report said, if the environmental protection tax rate for gasoline, oil and grease is reduced from April 1, 2022, the reduction in state budget revenue (including environmental protection tax) will be reduced. , VAT) will be about 23,954 billion VND. In addition, if the environmental protection tax is reduced in the remaining 9 months of 2022, the average CPI in 2022 will be estimated by 0.76% – 0.85%.
“Since the environmental protection tax is an absolute number and the CPI is a relative number, the impact of the reduction of the environmental protection tax on the CPI will gradually decrease when the petrol price continues to increase compared to the current one; decrease by 0.61% CPI if petrol price increases by 10% compared to current level; reduce CPI by 0.56% if petrol price increases by 20% compared to current level; decrease by 0.52% CPI if gasoline prices increase by 30% compared to the current level”, the Government’s report said.
Besides, the reduction of environmental protection tax on gasoline, oil and grease will contribute to sharing a part of the state’s benefits for people and businesses; contribute to reducing production costs of enterprises and saving consumption costs for people.
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