3:26:36 PM | 7/8/2005
The Ministry of Finance is considering reducing tariffs on air-conditioner and refrigerator components to help local electronics makers compete with imported products.
"We are urging associations of electronics makers to list the electronics equipment that domestic enterprises can produce and the equipment that they cannot produce so that we can apply an effective tariff scheme conforming to the protection principles," said Quach Duc Phap, head of the ministry’s Tax Policy Department.
“The tariff reduction is necessary to protect domestic manufacturers and keep the prices of electronics products from rising in the face of the rise in input costs,” he said.
However, according to experts, local consumers will hardly benefit from the tariff cut as the prices of electronics products are not likely to be reduced.
According to the ASEAN Free Trade Area’s tariff reduction scheme, the tariff on electronics will be reduced to 0-5 per cent in 2006. However, the prices of electronics products have been raised by 6-10 per cent this month.
Tran Trung Kien, head of LG MECA Electronics’ sales department explained that the price hike was a result of a 15-50 per cent rise in input costs.
Vietnam spent US$358 million on importing electronics and computer components in the first quarter of this year, up 39.5 per cent against the year-earlier period.
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