|
VAMA’s manufacturers criticised for setting sky high sale prices
In retaliation to Vietnam Automobile Manufacturers’ Association (VAMA) denouncement of car importers committing tax frauds, importers say domestic manufacturers are hitting consumers with sky-high sale prices.
One representative of a well-known Hanoi car import company says domestic automobile manufacturers are enjoying too many investment incentives without making any considerable contribution to industry development.
“Automobile manufacturers just assemble, not manufacture cars in Vietnam. Meanwhile, their sale prices are overly high. Why shouldn’t we let imports compete with domestically assembled cars to force the prices down?” he questioned.
The importer said the prices of domestically assembled cars of the same models are not much lower than imports, though domestic manufacturers enjoy a lot of preferences and cheaper labour cost.
For example, a Camry in Vietnam is priced at $54,000, while the sale price in the US is just $20,000. The Camry, if imported to Vietnam, would be priced at $57,000 after tax and fees, just a little more expensive by $2,000-3,000 than a domestically made Camry.
Currently, automobile manufacturers have to pay 23-25 percent only in tariffs for imported car parts for domestic assembling. Meanwhile, the tariff is very high at 83 percent for “complete built units” (CBU).
“Domestically assembled products are enjoying so many incentives. I believe that a price decrease of 25 percent would still ensure high profit for manufacturers,” he added.
“It would be really unreasonable to limit imports, when local production still cannot meet the demand,” he added.
In response to the criticism, VAMA’s Secretary Pham Anh Tuan, said that VAMA did not propose government agencies to limit imports, but just wants to stop trade frauds in car imports.
Tuan said that the import tariff on CBU imports is relatively high at 83 percent. However, more and more imports are still arriving. Statistics show that recent imports are even higher than imports at the time when tariffs were set at just 60 percent, proving that trade fraud has been increasing.
On the high car prices, Tuan said prices are high not because domestic manufacturers deliberately set the prices at those levels, but because of heavy taxes.
He went on to say that prices of domestically assembled cars depend on many factors, including the output, the locally made content of the cars, and especially, tax policies
Now, the General Department of Customs (GDC) has decided to put car imports into the list of products that need special supervision to avoid tax frauds.
The decision was made after VAMA warned government agencies about tax fraud. GDC itself also thinks that many importers have been trying to evade tax by declaring taxable prices lower than actual prices.
Besides cars, other products which have big import revenues like motorbikes, air conditioners, washing machines, steel and fabric will also be put under the special supervision.
VietNamNet, VNE, VnMedia
|
