Government may halve registration fees for locally produced automobiles
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The government has instructed the Ministry of Finance to assess the impact of a 50-percent cut in registration fees for locally produced automobiles.
Thanh Cong Motor Vietnam Joint Stock Company had called on the government to cut the fee to support an industry affected by Covid-19.
The ministry has been told to complete the task this month.
In June, the Vietnam Automobile Manufacturers Association (VAMA) had proposed a similar 50-percent cut in registration fees, but the ministry had rejected it.
Last year too the government had cut the fee by half, and it cost VND6 trillion ($260.9 million).
In the first six months of this year VAMA members, who account for more than 95 percent of the market, saw sales fall 30 percent year-on-year to 102,720 vehicles.
Car manufacturers fear the global effects of Covid would have a long-term impact on people’s incomes and auto demand.
VAMA expects sales to decline by more than 15 percent this year. Last year, they had risen by 11.7 percent to 322,322 units.
Questions & Answers
Q.Which body initially requested the government to reduce registration fees for locally produced automobiles?
Which body initially requested the government to reduce registration fees for locally produced automobiles?
Thanh Cong Motor Vietnam Joint Stock Company called on the government to cut the fee. The Vietnam Automobile Manufacturers Association had also proposed a similar 50-percent cut in June, which was rejected.
Q.What is the expected impact on sales for VAMA members by the end of this year?
What is the expected impact on sales for VAMA members by the end of this year?
VAMA, whose members comprise over 95 percent of the market, anticipates a decline in sales of more than 15 percent this year due to the long-term effects of Covid on incomes.
Q.When was a similar registration fee cut implemented previously, and what was its cost?
When was a similar registration fee cut implemented previously, and what was its cost?
The government cut the fee by half last year. This previous reduction in registration fees for automobiles cost VND6 trillion, equivalent to $260.9 million.
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