 |
| People buying petrol at a Petrolimex station in Hanoi__Photo: VNA |
The Ministry of Finance has proposed extending the current tax exemptions for gasoline, diesel and aviation fuels through June 30 to stabilise prices, support production and control inflation, according to a draft submitted to the Ministry of Justice for review.
The proposal would continue the set of temporary measures that reduce several tax components on fuels to zero, measures first introduced under Prime Ministerial Decision 482 issued on March 26.
That decision cut the environmental protection tax on gasoline, diesel and aviation fuel to VNĐ0 per litre, set the special consumption tax rate on gasoline at 0 per cent and allowed businesses to forgo declaring and paying value-added tax (VAT) while still retaining the right to deduct input VAT.
Those measures are currently scheduled to remain in effect until April 15.
Under the finance ministry’s draft, the same tax relief provisions would be extended from April 16 through June 30.
The ministry estimates that maintaining the environmental protection tax, VAT and special consumption tax at zero for this period would reduce State budget revenues by about VNĐ7.2 trillion (US$273.4 million).
Under the draft, the measures are framed as emergency and targeted interventions to support macroeconomic stability.
The finance ministry argues that lowering tax burdens on fuels, a critical input across production, transportation and services, helps reduce logistics and production costs, which can in turn lower product prices, bolster competitiveness and assist short-term economic growth.
The ministry also notes that these measures would contribute to inflation control and stabilise macroeconomic conditions while directly easing fuel costs for households, potentially reducing transportation and living expenses and supporting purchasing power.
A provision is included in the draft that would allow the Government to adjust the application period of any resulting resolution if urgent needs arise to ensure socio-economic stability and market order.
When the resolution expires, fuel taxes would revert to the statutory rates set by existing tax laws.
The ministry further said that, with the proposed adjustments, there would be no tax element incorporated into fuel prices. In other words, the relief is intended to be reflected directly in final pump prices rather than accounted for as a deferred tax component.- (VNA/VLLF)
