50% Reduction in Auto Registration Fee to Boost Domestic Consumption

The Vietnamese Government decided to reduce the vehicle registration fee by 50% for cars manufactured or assembled in Vietnam until the end of 2020 to boost domestic consumption.

The Government has just issued Resolution 84/NQ-CP on tasks and solutions to continue removing difficulties for production and business, promoting disbursement of public investment capital and ensuring social order and safety in the context of the Covid-19 pandemic.

The 50% reduction of registration fee for cars is one of the solutions proposed by the Ministry of Industry and Trade to the Government to support automobile enterprises to recover domestic production, business and stimulus demand. In addition, the Vietnam Association of Automobile Manufacturers proposed that the Government reduce by 50% the VAT rate and car registration fee for customers to stimulate consumption.

Currently, registration fee for cars with capacity up to 9 seats is 10% of the price of a car, and in Hanoi it is 12%. Therefore, the policy of 50% reduction of registration fee will save people from tens to hundreds of millions VND, depending on the type of vehicle.

In addition to the reduction of automobile registration fees, the Government decided to reduce by 15% the land rent fee paid by enterprises, organizations, households and individuals who have to stop their production and business due to Covid-19 in 2020 under the decision or contract of the competent state authority in the form of annual land rent payment.

The Government also decided to grant free guarantee arising in 2020 for loans guaranteed by the Government for aviation enterprises with outstanding loans until December 31, 2019; 50% discount on the price of takeoff and landing and the price of flight control service for domestic flights from March to the end of September 2020; The minimum price of VND 0 is applicable to aviation services listed on the State's list of prices from March to the end of September 2020.

Besides, the Government also decided to extend the time limit for paying special consumption tax on domestically manufactured or assembled cars for amounts payable from March 2020. The extended period is no later than December 31, 2020. The Government is also studying to amend the regulations on special consumption tax to support the development of domestic production.

Source: Vietnam Business Forum