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Ministry agrees to cut import tax on gas
The Ministry of Finance has cut import tax on gas from 5 per cent to 2 per cent to stabilise the domestic gas market.
The new tariff came into effect last Friday and gas retailers PV Gas, Petrolimex Gas, Sai Gon Petro Gas, Vinagas and Gia Dinh Gas immediately cut their retail price by VND8,000 (US$0.38) on 12kg canisters.
The move comes at the end of a year when the price of gas in Viet Nam rose seven times so far this year. Before the cut, retail prices for canisters ranged from VND330,000 ($15.71) to VND360,000 ($17.14) depending on the brand.
The Viet Nam Gas Association originally proposed the tax cut after rises in the world's gas price led to similar increases on the domestic market.
Industry insiders said gas world prices had risen about $200 to roughly $1,000 per tonne this month.
The gas association's Chairman Nguyen Sy Thang said dependence on imports made doing business difficult for gas traders. Without tax cuts, domestic gas prices would continue to rise.
The country currently imports roughly 60 per cent of its total gas needs.
Thang also said that the import tax rate of 5 per cent had been set by the Ministry of Finance when the world gas price was $200 per tonne but with prices now at $1,000 per tonne, the previous tax rate was too high.
Earlier this month, the country's largest gas provider PV Gas offered discounts of VND5,000 on 12kg canisters to stabilise the domestic gas market. The price cut was made possible by domestic supply from the Dung Quat Oil Refinery.
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