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Kerosene, diesel import duty waived
The Ministry of Finance (MoF) has axed the 2 per cent tariff on kerosene and diesel imports to stabilise supplies and offset losses incurred by distributors and dealers.
Circular 24/2011/TT-BTC comes into effect on Feb. 24.
Meanwhile, the zero tax rate on gasoline imports that came into effect on January 14 will continue.
Fuel importers and distributors have suffered huge losses this year as global oil prices have risen. In the past few days, the wholesale price of A92 petrol has surged to US$106.3 a barrel, while crude oil prices have soared to $115-$116 per barrel, according to the ministry.
Dealers said they were losing about VND3,000 (14 US cents) on each litre on petrol sold and VND4,000 per litre on diesel and kerosene. Meanwhile, cross-border fuel smuggling has been rife.
In the past few days, numerous petrol stations have closed. Those that remain open have raised prices to offset losses – despite claims by the Ministry of Industry and Trade (MoIT) and the leading fuel distributor Viet Nam National Petroleum Corporation (Petrolimex) claims that there were no fuel shortages.
On February 11, the Ministry of Finance permitted petrol dealers and distributors to be compensated for losses from the fuel price stabilisation fund. From the fund, petrol distributors and dealers have received an additional VND450 and VND700 per litre of petrol and diesel on top of the VND1,650 and VND2,300 per litre they were already getting.
The State and consumers have forked out about VND11 trillion ($529 million) to compensate filling stations and distributors, with VND3.5 trillion ($168 million) coming from the stabilisation fund. The remainder was raised from import tax adjustments over the past few months, according to MoF.
Nguyen Tien Thoa, director of Pricing Management Department, told Viet Nam News Agency the Government under Decree 84 had used various means to help stabilise prices, such as import tax reductions, the fuel stabilisation fund and price adjustments.
"This is to ensure the market performs well. We are also hoping to reduce cross-border smuggling," he said.
Numerous motorists have complained that they were having problems getting petrol. In response, MoIT ordered wholesale petrol trading companies to improve distribution.
The ministry also asked local agencies to conduct more inspections of petrol stations to ensure meters in the capital were accurate.
Furthermore, the ministry's Market Management Department said it would continue to ensure prices were legal, while attempting to stamp out smuggling.
In addition, petrol trading companies in HCM City have been warned that they would face tougher penalties if they violated petrol trading regulations.
Nguyen Thi Hong, deputy chairwoman of the city People's Committee, told a meeting on Monday that the Ha Noi authority would come down hard on petrol stations and distributors guilty of price speculation.
"If the violation is serious, the city will revoke their business licences and bring criminal charges," Hong said.
Hong said she had assigned the Industry and Trade Department to work with local market management teams to check petrol station prices and ensure pumps were accurate.
Duong Thanh Hoang, Deputy Head of the HCM City Market Management Department, said higher world petrol prices and the depreciation of the dong to the US dollar recently had forced some petrol stations to close or limit supplies.
vietnamnews
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