Voters from Dong Nai province recently proposed that MOF cut some kinds of taxes and fees in order to keep petroleum product prices stable, which affects other hoods prices.

The voters said that high taxes and fees which make up high proportion of gasoline prices are why gasoline prices are high despite measures taken to force prices down.

MOF said in many other countries, taxes and fees account for 45-60 percent of gasoline prices. The figures are 20-21 percent for petrol in Vietnam and 10-11 percent only for diesel. The ministry said that fuel prices in Vietnam are lower than the average price around the world.

It cited statistics by Global Petrol Prices on July 10, 2023 about the gasoline prices of countries which share the same border with Vietnam. The prices are VND26,956 per liter in China, VND32,698 in Laos and VND27,489 in Cambodia.

According to MOF, there are four kinds of tax imposed on petroleum products, including import tax (applied to import products), VAT, luxury tax (imposed on gasoline) and environmental protection tax.

Regarding the import tax, the tariffs are defined in accordance with free trade agreements (FTAs) that Vietnam has signed with other countries, under which the tariff on products under the ASEAN-South Korea and Vietnam-South Korea FTAs are 8 percent on petrol and zero percent on diesel.

Regarding the most favored nation (MFN) status, in order to diversify import supply sources, MOF has submitted to the government a plan to promulgate a decree on cutting tariffs on some groups of petrol from 20 percent to 10 percent. 

The ministry has also proposed lowering MFN on ethanol which is used to create biofuel and some input materials for the production of petrol, oil and products replacing petrol.

The adjustment is expected to help slash domestic petrol production costs and create conditions for enterprises to buy input material sources at lower costs. 

The luxury tax is 10 percent on gasoline and 8 percent on E5 fuel, and 7 percent on E10, a lower average level compared with other countries.

Luong Bang