Posted on 05 Jan 2009
Auto manufacturers have asked the Government to delay a proposed hike in special consumption and value-added taxes and, in fact, to roll them back to pre-April 2008 levels.
At a recent meeting with officials from the Ministry of Industry and Trade , manufacturers also called for delaying a hike in registration fees in Ha Noi, citing severe difficulties due to the global recession.
The special consumption tax is set to go up from 30-50 per cent to 45-60 per cent and value-added tax from 5 to 10 per cent.
The fee to register automobiles in the capital is set to be raised from 10 to 12 per cent.
The manufacturers also sought a dialogue between the Government and the Viet Nam Automobile Manufacturers Association (VAMA) to develop a comprehensive long-term strategy for the auto industry.
VAMA said the industry is being affected by a plunge in demand due to the global economic recession and changes in tax policies last year.
In this context, increasing taxes and registration fee would severely worsen the situation, it warned.
Average sales in the last quarter of 2008 was down by nearly half from earlier in the year as a result of a hike in the registration fee from 5 to 10 per cent, VAMA said.
The industry is considering shedding 2,000-3,000 jobs, or 20-30 per cent of its total workforce, the association said.
