The Ministry of Finance has disapproved Auto Motors Vietnam (AMV) and domestic taxi operator Mai Linh Group’s proposal for an exemption from import tariffs and special consumption taxes (SCT) for electric cars using for passenger transport services, according to newswire Dantri.com.

Accordingly, imported electric cars for passenger transport services are not under the tax exemption list. Thus, Mai Linh Group has to pay the corporate income tax, the SCT, and other types of taxes and fees related to electric cars, according to Vietnamese legal’s regulations.

Currently, the average import tariff for these environmentally-friendly cars is 70 per cent.

In line with amendments and additions to the current laws on Value Added Tax, Excise Tax and Tax Administration, which was approved by the National Assembly on April 6 and will take effect on July 1, 2016, the SCT for passenger-transport electric vehicles with nine seats and below is decreased to 15 per cent, far lower than a high of 25 per cent earlier stipulated in the amendments to the Law on Special Consumption Tax.

However, enterprises importing electric cars for passenger transport services in general and AMV as well as Mai Linh Group will be exempted from paying value added tax.

On April 8, Mai Linh Group and French car maker-Renault officially signed the contract on the importing of electric cars for the group’s passenger transport services.

Accordingly, Mai Linh will import 100 Fluence ZE electric cars at a price of $29,000 each, to pilot in Hanoi, Ho Chi Minh City, and Danang. The cars are expected to arrive to Vietnam in June.

Previously, Mai Linh and AMV, the exclusive importer of Renault cars in the country, signed a Memorandum of Understanding on the importing of between 10,000 and 20,000 electric cars within five years.

Mai Linh requested government agencies, including the ministries of Finance and Transport, Planning and Investment, Natural Resources and Environment, and Science and Technology, to decrease or eliminate tariffs on the importing of electric cars, as well as decrease value-added tax, special consumption tax, and other types of taxes and fees related to electric cars.

Mai Linh also asked for land to build the necessary infrastructure for its project, including parking lots and charging stations.