Vietnam Cuts Petroleum Import Tax Down to 5 per cent

Vietnam Cuts Petroleum Import Tax Down to 5 per cent

Vietnam's Ministry of Finance (MoF) has decided to reduce the import tax on petroleum products from 15 per cent to 5 per cent since February 6.

This is for the second time this year that the MoF has amended the petroleum import tariff. It raised the tax from 0 per cent to 15 per cent on January 6.

The reason for the tax cut is attributed to the increase in crude oil price in the global market. However, the tax cut will not have an impact on local consumers as the government sets retail oil prices, MoF officials said.

In May 2004, the MoF removed import duties on gasoline, condensates, kerosene, diesel, naphtha and reformate when the oil prices in the world market surged. It resumed import tariffs imposed on petroleum products in January 2005.

Vietnam plans to import 2.9 million metric tonnes of petroleum products in the first quarter this year, up from 2.87 million tonnes in the first quarter of last year.

In 2004, it was estimated to import 10.87 million of refined oil, up 9.2 per cent against 2003.

Vietnam, the sixth largest crude oil exporter in Asia, has to import almost all refined petroleum products to feed the national energy consumption because it has no refineries.

• New Hanoi