Finance Ministry takes action to deal with rising gasoline prices
VIETNAM, June 17 –
Gasoline prices have risen six times in a row in almost two months. — Photo danviet.vn
HA NỘI — After the proposal to reduce the Petroleum Price Stabilization Fund and Import Tax, the Ministry of Finance (MoF) announced its intention to reduce the environmental tax on fuel.
As gasoline prices have increased six consecutive times in nearly two months, the proposal for new measures will be submitted to the National Assembly for consideration, Deputy Finance Minister Nguyễn Đức Chi said.
As retail gasoline prices rose by 3 p.m. on Monday June 13 at the highest rate on record, marking the sixth consecutive increase, a Grab driver from Nam Định province told Việt Nam News: “I haven’t recovered from the pandemic yet, now the summer heat, sudden rain and rising petrol prices are making me so exhausted.
Nguyễn Văn Thông, 53, has to work more than 15 hours a day to earn a living and raise her children in a rented house in the capital. He said: “I can’t stop working or my children will go hungry, but the higher price of petrol has caused a lot of hardship.
Under the decision of the Ministry of Industry and Trade and the Ministry of Finance, the retail prices of gasoline E5 RON 92 and E5 RON 95 increased by 880 VNĐ and 800 VNĐ per liter to reach 31,110 VNĐ and 32,370 VNĐ per litre, respectively.
Meanwhile, the price of diesel and kerosene increased by 2,630 VNĐ and 2,490 VNĐ per liter to reach 29,020 VNĐ and 27,830 VNĐ respectively.
This was the sixth consecutive increase in gasoline prices since April 21, with total increases amounting to VNĐ5,060 and VNĐ4,640 per liter for RON95 and E5 RON 92, respectively.
Bicycle driver Nguyễn Văn Thông said, “The rise in gasoline prices has caused the prices of many other goods and necessities to rise,” adding that he did not receive a respective increase in his income.
Thông said that many of his colleagues quit because they thought it was not worth it, but as the main breadwinner, Thông must continue to work.
According to calculations, each liter of RON95-III gasoline costs 32,370 VN, including the port import price of 22,389 VN, 10% import tax, 10% special consumption tax and 10% value added tax, as well as VNĐ2,000 environmental protection tax. Thus, with the above four taxes, consumers have to pay more than 9,400 VNĐ, or more than 29%.
An insider told local media that with business expenses, the total taxes and fees charged on a liter of gasoline is more than 34%, adding: “If you buy 100,000 VNĐ of gasoline, the consumers have to bear more than VNĐ 34,000 in taxes and fees If the excise tax is removed and the collection of value added tax and import tax is temporarily suspended, the price of gasoline could be reduced from over 32,000 VNĐ to around 23,000 VNĐ per litre.
Thông, Grab’s driver, told Việt Nam News, “I hope the ministry can do it as soon as possible.”
According to MoF data, currently, each liter of gasoline and oil of all kinds must bear a tax of VNĐ 300 to VNĐ 2,000 from April 1 to the end of December 2022 after the halving of the protection tax of the environment from 3,000 VNĐ to VNĐ4,000 before that, in accordance with Resolution 18.
If the new environmental protection tax reduction is approved by the NA, each liter of gasoline will be reduced by an additional 2,000 NV, which could mitigate the impact of rising gasoline prices on the economy.
The Ministry of Finance said that as the tax reduction has proven effective, it has continued to offer tax and fee reductions to rein in gasoline prices, adding that since the start of the year, when gasoline prices showed signs of increasing, Việt Nam implemented petroleum policies such as the 2 percent VAT reduction; a 50 percent reduction in the environmental protection tax on jet fuel; a 50-70% reduction in the environmental protection tax for petroleum products, as well as a reduction of 37 fees and charges in the first six months of 2022.
Thanks to this action, the CPI in the first five months of the year rose by 2.25%, a slight increase compared to 1.3% in the same period last year, said a representative of the Ministry of Finance.
However, during the last six months of the year, gasoline prices have steadily increased and many countries and territories such as the United States, EU, Japan and Korea have faced problems with high gasoline prices, causing economic instability, he said.
Local statistics indicate that the tax costs related to gasoline price composition in Việt Nam were quite significant, ranging from 30-45% of gasoline prices, including import tax, special consumption , VAT and business expenses. —VNS