Vietnam cuts environment tax on fuel to weather transportation costs
The Vietnamese national assembly has approved of a further 50% cut in environmental tax on fuel as the country braces itself against soaring energy and transportation costs. The second tax cut in three months will apply from July 11 to the end of the year.
Vietnam’s consumer prices in June rose 3.37% from a year earlier, led by higher food and energy costs, while transportation costs climbed 21.4% from a year earlier. The tax cut is aimed at alleviating some pressure on inflation as energy prices ratchets upwards – Vietnam is aiming to keep inflation below 4% for 2022.
According to reports, the environment tax on gasoline and on diesel fuel would be halved to VND1,000 (USD0.0428) per litre and VND500 per litre, while tax on jet fuel will be reduced to the floor price of VND1,000 per litre.
However, tax on kerosene would be kept at VND300 per litre.
The finance ministry estimated tax collection would be reduced by VND32.5 trillion (USD1.39 billion) under the new rates.