The 50 percent vehicle registration tax cut policy has been applied three times in Vietnam since 2020. The tax cuts encouraged people to buy cars as they could save large amounts of money, thus helping auto manufacturers boost sales.

That was why MOF once again proposed a tax cut for the fourth time, from August 1, 2024 to January 31, 2025. However, the proposal had not been approved by August 1 as expected. This disappointed people who had waited for many months with a hope to buy cars at good prices.

Quoc Viet, 47, from Tan Binh district, HCM City, said he initially planned to buy a KIA Sorento in May 2024, but he later changed his mind as he was advised to wait until August, because the vehicle registration tax might be cut by 50 percent, which would allow him to save VND60-70 million.

However, he realized that he made a wrong decision as the proposal on 50 percent tax cut has not yet occurred. 

His friends and relatives gave him words of comfort, saying that if he buys the car in August, or the seventh month of the lunar year, he will be able to enjoy a lot of preferences offered by automobile manufacturers and sales agents.

But for Viet, this is not a good choice. He decided to run against the clock and bought the car late last week, just a few days before the seventh month of the lunar year began. In general, car dealers always offer attractive preferences to buyers in the month, when the demand is weak.

In Vietnam, the seventh month of the lunar year is considered the month of forsaken spirits. Vietnamese believe that it is better not to do important things during this time or misfortune will come.

He felt lucky as he could buy the car and register before August 4, even though he could not enjoy the 50 percent tax cut as expected.

Nguyen Thi Ha Thanh from district 10, HCM City is not as lucky as Viet. When she came to a car dealer last June to buy a Hyundai Elantra, she was offered a lot of preferences from the dealer, estimated to be worth VND40 million. However, she did not buy because he heard about the possible vehicle registration tax cut. She hoped that when the policy is set, she would be able to buy the car at a lower cost.

Since the tax cut has not occurred, she decided to return to the dealer to buy the car. However, the car dealer said that the preferences he offered in June no longer exist

“So, I lost hook, line and sinker,” she complained.

Many other car buyers also complained that they have fallen into the ‘tax cut trap’. Bui Bao Ngoc from Vung Tau City bought a KIA K3 in May, but he decided not to make car registration until August to enjoy the 50 percent tax cut.

However, Ngoc has realized that he waited three months in vain. 

Of course, the pending policy has also disappointed car dealers.

Dinh Nam, a salesman at a Mitsubishi showroom in district 7, HCMC, told VietNamNet that after hearing that the proposed 50 percent tax cut was not approved, he called many of his clients, urging them to come to get deliveries at once on the last days of the last week, before the ghost month on August 4.

VietNamNet reporters, who stopped at sales agents and car showrooms in districts 7 and Go Vap, found that the car market on August 1-2 was more bustling than previous days.

Kim Chieu, a saleswoman at a Toyota agent in Go Vap district, confirmed that the number of car buyers increased late last week and she sold two products on August 1 alone.

However, some analysts have said that though the tax cut proposal was not approved by August 1, this doesn’t mean that the proposal has been rejected.

If car buyers are not superstitious, they still can buy cars in August, or the seventh lunar month, with many preferences from car dealers, and, possibly from the government as well if it approves the tax cut proposal in upcoming days.

Vo Tam - Ngo Minh