Ministry proposes raising environmental tax on petrol
Updated : Thursday, May 17, 2018 9:29 AM (GMT+0700)

TheMinistry of Finance has proposed a rise of environmental protection tax onpetrol to the ceiling level of 4,000 VND (17 US cent) per litre from thecurrent 3,000 VND (13 US cent) per litre.

 
Illustrative image - Source: VNA

In a draft resolution onenvironmental protection tax list it has sent to the National Assembly StandingCommittee, the ministry also suggested an increase of tax for oil products toanother ceiling level of 2,000 VND (8 US cent) per litre.

With the raise, State budgetcollection from petrol and oil taxes will reach about over 55 trillion VND(2.42 billion USD), about 14.3 trillion VND higher than the current amount.

Apart from petrol,environment taxes for other products such as fossil coal, hydrocloflocacbon(HCFC), and plastic bags will also rise from 1,000 VND-10,000 VND.

Specifically, tax on fossilcoal will be up by 5,000 VND-10,000 VND per tonne, resulting in tax revenue ofabout 2.38 trillion VND each year, an increase of 795 billion VND each year.

Meanwhile, tax on plasticbags will also rise by 10,000 VND each kilo, which means from 40,000 VND perkilo at present to 50,000 VND per kilo. Estimated tax revenue from the productwill be about 67.5 billion VND.

According to the ministry,if the proposal is approved, total revenues from environmental protection taxeswill be about 57.61 trillion VND per year, up about 15.18 trillion VND peryear.

The ministry explained thatthe environmental tax for oil and petrol products have been applied since 2012,helping raise public responsibility and awareness of preserving theenvironment, while encouraging the production and use of green products asVietnam is gradually cutting import taxes following its internationalcommitments.

From 2012-2017, totalcollection from environmental protection taxes were about 150 trillion VND, or25 trillion VND each year.

However, the ministryrecognised the need to adjust the taxes to a more suitable level, as the retailprices of petrol in Vietnam is lower than that in neighbouring countries andsome countries in the ASEAN and Asia.

Currently, Vietnam’s petrolretail price at 19,980 VND (0.87 USD) per litre is lower than that in 120 othercountries.

At the same time, theministry underlined that research showed that the use of goods  that aresubject to environmental protection tax harms the environment. Scientists’calculation clarified that the tax must be much higher in order to fix theharms done by those goods.

A survey of the ministry onthe proposed environmental tax raise on the online portals of the Governmentand the ministry has received 77 opinions of other sectors and ministries,localities, business associations and organisations, of which 47 opinionsagreed on the necessity of the tax increase.

Source:VNA

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