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Taxes could be raised to limit car imports
Deputy Minister of Industry and Trade Bui Xuan Khu has mentioned the possibility that the taxes on car and car part imports could increase further in an effort to reduce the trade gap.
Khu said that the ministry is considering raising the tax on complete built unit (CBU) cars from the current level of 83% and other luxury items in order to narrow the trade gap in the second half of the year.
At a workshop on imports and exports in the first half of the year, a representative of the International Monetary Fund, Benedict Bingham, said that the trade gap in the first six months of the year, equal to 40% of import turnover, should be seen as a worrying figure.
According to the General Statistics Office, the trade deficit in the first half of the year was 3-4 times higher than that of the same period of 2007. The imports of CBU cars were 61.1 times higher than the same period of 2007 with 42,000 units imported, worth $742mil, while the imports of car parts increased by 3.2 times.
Khu said that in addition to raising taxes, the ministry might also apply an automatic import licencing scheme and require taxes paid for the imports right at clearance.
As for the automatic import licencing scheme, the Ministry of Industry and Trade could even stop licencing if it finds that other measures to restrict imports are also ineffective.
Earlier this year, fearing that the import tax might be raised to 94%, car dealers rushed to import cars in order to avoid the forecast high tax. As a result, in April and May, some 7,000 units were imported, causing oversupply.
According to the Road Transport Police Agency, 15,000 cars were imported in the first four months of the year, but only 10,000 units have been registered, which means that some 5,000 units are still unsold.
Supposing every car is valued at $30,000, then the total value of the unsold cars would be $30mil, which means that $30mil worth of capital is being buried in the car import deals.
According to the General Department of Customs, 1,700 cars arrived in June, just a half of the imports in May, 3,300 units. This was a record decrease in car imports in the first half of the year.
VNN
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