Automotive Industry: Disagreement in Tax Policy

As concerned by many people who are interested in Vietnam's automotive industry, the Ministry of Finance and the Ministry of Industry and Trade have many disagreements in making tax policies related to the operation of automobile businesses. In fact, tax policies are closely related to the performance of enterprises and have a great impact on the decision to continue investing activities in Vietnam.

In the context of countries in the ASEAN region such as Thailand and Indonesia, there are many flexible and attractive policies to attract new investments with great value for the automotive industry, especially projects. Regarding to electric-cell cars, the fact that Vietnam's policy agencies still "no, she ransom" about tax policies, it is forecasted that it will be difficult for any more breakthrough investment to pour into the industry. automobile industry from now to 2018 - the time of import tax on CBU from ASEAN countries to 0%.

The problem that many automobile enterprises engaged in manufacturing and assembling in Vietnam are currently concerned about is the import tax roadmap for CBU cars from ASEAN countries from the year of import-export to the year of import-export. According to the proposal of the Ministry of Industry and Trade, when specifying mechanisms and policies for the implementation of the Strategy and Planning for Vietnam's Automobile Industry Development, the import tax rate should remain the same as the% of import tax until the year of import-export. down to 2015% from the year 2018.

This roadmap is also supported by businesses with deep manufacturing activities in Vietnam such as Toyota Vietnam or Truong Hai Auto Company. These automobile enterprises have said that, with the import tax rate of cars at the rate of 50%, assembled in Vietnam, there is still a certain advantage with the import, but if it decreases to 30%, this advantage will be lost. and the import of complete units will certainly increase in enterprises without deep investment.

Meanwhile, the Ministry of Finance said that the gradual reduction of the import tax rate for cars, which means gradual relaxation of the protection level, will avoid a sudden tax reduction at the end of the roadmap. This gives the auto industry time to adapt before it faces a complete elimination of taxes. The roadmap previously drafted by the Ministry of Finance is from 2014 to 2015 with the tax rate of 50%, in 2016 to 40%, in 2017 to 30% and in 2018 to 0%.

Although the final plan will be decided by the Prime Minister, it can be seen that the views of the Ministry of Finance and the Ministry of Industry and Trade in the tax policy for cars continue to not follow the same path as the reality of dozens of past year.

This is more evident with a series of proposals of the Ministry of Industry and Trade and the comments of the Ministry of Finance related to cars.

Proposal on the reduction of special consumption tax for cars with 5 seats or less with cylinder capacity below 2.000 cm3 or adding tax lines for fuel-efficient vehicles also did not receive the approval of the Ministry of Finance.

The reason is that, according to the Ministry of Finance, when implementing the commitments to cut import tax rates, there will be many components that are eligible for tax reduction, causing a large loss of revenue due to cars and components being capital goods. have high tax rates, large turnover. In the context of the reduction of import tax and corporate income tax also reduced to 20% in the year 2016, the reduction of excise tax on cars will further reduce revenue, while the goal of encouraging development The automobile industry is still not up.

The rare harmonization of the two ministries lies in the corporate income tax. With the proposal of the Ministry of Industry and Trade on the exemption of corporate income tax in the first year of export processing, reduction of the export value in the next year and the application of the export tax rate in the next year according to the Law No. 4 / 50 / QH9, effective from dated 10 / 30 / 32 and Decree 2013 / 13 / ND-CP, the Ministry of Finance also said that enterprises producing spare parts meet the conditions set forth or invest in the production and assembly of vehicles. Environmentally friendly are definitely enjoying the offer.

However, the related fees such as environmental fees, emissions, fees for private cars going to the inner city or registration fees continue to be witnessed practically without finding a common voice among the Ministry of Industry and Trade.

According to Thanh Huong - Investment Newspaper

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