Halve car registration fees to boost sales
In this article (5)
Prime Minister Pham Minh Chinh has asked the Ministry of Finance to halve registration fees for locally-made or assembled automobiles starting July 1.
A draft decree on the issue should be submitted to the Government for approval before June 15, he said.
The cut will be in effect until the end of this year to boost falling demand.
The registration fees are calculated based on car prices in each locality. The rates are 12% in Hanoi and Hai Phong, and 10% in HCMC.
The Vietnam Automobile Manufacturers Association (VAMA) said credit tightening and rising interest rates have diminished market liquidity, and automobile companies are struggling to cope with high inventories.
In the first four months VAMA saw 92,801 cars sold, down 30% year-on-year.
Experts have predicted that total vehicle sales this year will unlikely reach last year’s figure of half a million units.
Questions & Answers
Q.What is the primary reason the Prime Minister has proposed halving car registration fees?
What is the primary reason the Prime Minister has proposed halving car registration fees?
The Prime Minister's proposal to cut registration fees is aimed at boosting falling demand for automobiles. The measure is intended to help address the struggle of automobile companies with high inventories.
Q.When is this proposed reduction in car registration fees expected to take effect and for how long?
When is this proposed reduction in car registration fees expected to take effect and for how long?
The proposed halving of registration fees is expected to start on July 1. It will remain in effect until the end of this year, according to the Prime Minister's request.
Q.What are the current car registration fee rates in major Vietnamese cities before any proposed changes?
What are the current car registration fee rates in major Vietnamese cities before any proposed changes?
Currently, the car registration fee rates are 12% in Hanoi and Hai Phong. In Ho Chi Minh City (HCMC), the rate is 10%, with fees calculated based on individual car prices.
Q.What impact have recent economic conditions had on car sales according to the Vietnam Automobile Manufacturers Association?
What impact have recent economic conditions had on car sales according to the Vietnam Automobile Manufacturers Association?
The Vietnam Automobile Manufacturers Association (VAMA) stated that credit tightening and rising interest rates have reduced market liquidity. Car sales were down 30% year-on-year in the first four months, with 92,801 units sold.
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