The Government has hiked import taxes on used cars for the second time in three months following a circular released by the Prime Minister. Cars of Nine seats or fewer and an engine displacement of less than 1,000 cc will see import tariffs rise by $800 to $ 5,000 by June 26.
Meanwhile, used cars with a cylinder capacity of between 1,000-1,500 cc will see taxes lifted to $10,000. The previous hike in April saw the tariffs lifted significantly to $4,200 and $9,600 respectively.
According to recent regulations, in order to be defined as second-hand, used cars must have been registered in a foreign country for at least six months before being exported to Vietnam and they must have a minimum mileage of 10,000 km. Kia Morning cars assembled by Thaco in Vietnam bear a $4,500 special consumption tax plus $2,500 of import tax for parts and accessories.
"That means fraud is resulting in unfair competition between imported cars and locally assembled cars, especially of the brand that we are assembling," said Thaco's CEO Tran Ba Doung.
Vietnam imported 4,000 cars worth $60 million in May, bringing the total car imports in the first five months of the year to 14,000 units, worth $247 million, according the General Office of Statistics. Car importers and traders said the April 1 cut in registration fees had encouraged buyers, along with the loosened credits for automobiles.
According to the Ministry of Finance, Vietnam imported 27,000 cars in 2012, down 50 % year-on-year.
Reference : Viet Nam News. The national englush language daily
