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Auto makers ask Government to delay tax hike
Auto manufacturers have asked the Government to delay a proposed hike in special consumption and value-added taxes and, in fact, to roll them back to pre-April 2008 levels.
At a recent meeting with officials from the Ministry of Industry and Trade, manufacturers also called for delaying an increase in registration fees in Hanoi, citing severe difficulties due to the global recession.
The special consumption tax is set to go up from 30-50 percent to 45-60 percent and value-added tax from 5 to 10 percent.
The fee to register automobiles in the capital is set to be raised from 10 to 12 percent.
The manufacturers also sought a dialogue between the Government and the Vietnam Automobile Manufacturers Association (VAMA) to develop a comprehensive long-term strategy for the auto industry.
VAMA said the industry is being affected by a plunge in demand due to the global economic recession and changes in tax policies last year.
In this context, increasing taxes and registration fee would severely worsen the situation, it warned.
VAMA said average sales in the last quarter of 2008 were down by nearly half from earlier in the year as a result of a rise in the registration fee from 5 to 10 percent and the industry is considering shedding 2,000-3,000 jobs, or 20-30 percent of its total workforce.
VNS
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