Sterner tax regime on car imports

The General Department of Customs has issued a new reference table of imported car prices aimed at helping its officials combat import tax evasion.

The department’s new taxable price table lists over 1,000 automobile and truck models, both new and used (under 9-seats cars, buses and lorries), and increases the reference prices for tax purposes by 2-20 percent.

The reference price of a Toyota Corolla, for the purpose of calculating the import tax, has risen in the table by about US$1,500 over 2009, while high-grade models from Bentley, BMW and Cadillac would see increases of thousands of US dollars.

The department based the new table on the suggested retail prices of foreign auto manufacturers and the fluctuation in the foreign exchange rate between the Vietnamese dong and the US dollar.

Customs officials would continue to apply tax rates set by the Ministry of Finance to the actual declared value of the vehicles, but the higher reference prices would increase pressure on importers to properly document any prices that significantly vary from the reference prices in the table, said Nguyen Van Can, deputy head of the department.

In the past, the taxable price table has proven to be a useful tool for limiting attempts at tax fraud and evasion, added a department official who asked to remain unnamed.

Deputy Minister of Finance Tran Van Hieu also said, at a press conference on March 2, that it was necessary to control more closely the import of luxury goods to balance the country’s trade deficit.

In light of the Government’s efforts to cut the trade deficit, the volume of automobiles imported into Vietnam decreased sharply in the first two months of the year, with 3,400 units imported in January and 2,500 in February, down 69.6 percent and 26.5 percent from previous months. The trend was expected to continue in March, according to General Statistics Office prediction.

Meanwhile, the Ministry of Industry and Trade is seeking agreements with related agencies to continue restricting imports of cars with fewer than 16 seats. In a recent petition sent to the Ministry of Finance and the Ministry of Transport, the Ministry of Industry and Trade proposed higher tax rates and fees on such vehicles, as well as stricter registration requirements.

VNS/VOVNews

Tags: Vietnam auto, Vietnam automotive, Vietnam automotive industry, vietnam car, Vietnam car imports