A representative of the ministry told VietNamNet that along with the environmental protection tax cuts to floor tax rates applied until the end of December 31, 2022, and the MFN (most favored nation) tax adjustments, MOF has submitted to the Prime Minister a plan to cut the luxury tax on petrol and VAT on petroleum products to help lower prices.

The tax cuts have not been revealed, but the information has been applauded. MOF wants to ease the financial burden on people and help businesses cut operation costs.

Prior to that, MOF completed a draft resolution of the National Assembly’s Standing Committee on adjustment of the environmental protection tax on petrol, oil and lubricants until the end of 2022.

The ministry plans a VND500-1,000 per liter reduction in environmental protection tax on  products to stabilize domestic prices amid price fluctuations in the world market.

The proposed decreases are VND1,000 per liter on petrol (from VND2,000 to VND1,000 per liter), and VND500 per liter on air petrol (from VND1,500 to VND1,000 per liter).

In March, based on the proposal from MOF, the Government and National Assembly Standing Committee approved the resolution on the adjustment of the environmental protection tax until the end of 2022. 

Under the resolution, since April 1, the environmental protection tax on petrol has decreased from VND4,000 per liter to VND2,000. Meanwhile, the tax rate on diesel, mazut and lubricant has fallen by VND1,000 per liter, from VND2,000 to VND1,000. The tax rate on kerosene has fallen by VND700 per liter from VND1,000 to VND300.

Cutting taxes further to curb petrol prices is a solution supported by many economists and government officials. The issue was put into discussion in the latest National Assembly session, where Minister of Finance Ho Duc Phoc said he supported cutting taxes and fees.

Economists also support a tax cut plan, saying that it is necessary to curb petrol prices so as to curb inflation, because high inflation will cause serious consequences to the national economy.

Luong Bang