Auto importers bemoan tax policy change
Ten auto importers have complained that rapid changes in the calculation method for special consumption tax on completely-built-up (CBU) autos have made it hard for them to build viable business plans.
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However, the method will be changed from July 1 when the law on amendments and supplements to some articles of the laws on value added and special consumption taxes approved by the National Assembly takes effect.
Tran Tan Trung, general director of Lien A International JSC, the official distributor of Audi cars in Vietnam, said importers remain vague about the new calculation method.
He was speaking at a media briefing held last week to announce Audi Progressive, a program to introduce new models of Audi autos in Hanoi.
He said prices of imported autos are predicted to soar and that though special consumption tax on cars of less than 1.5 liters would drop by five percentage points from July, prices of these autos would not fall based on the new calculation method.
It is unclear if the new calculation method will affect dealerships or consumers but in either case, auto prices will certainly edge up.
The auto importing firms said in the petition that problems will occur when the Law on Special Consumption Tax goes into force in early July given the unclear new tax calculation method.
The ratio used to compare the average selling price of dealerships will fluctuate in an unspecified range.
Auto importers said there has not been detailed information and guidance about the execution of the law though it will come into force in the next two months.
The auto importing companies petitioned the Ministry of Finance to keep the current tax calculation method in place and suspend the new one until a specific ratio used to compare selling prices and a definition of commercial facilities, among others, are made clear.
They said the calculation method adjusted two times within a span of just six months and applied in two or three months after they are announced would make life difficult for them.
They said the adjustment would affect the market, demand and tax collections.
Firms asked the ministry to guide and set appropriate schedules for the new tax application to avoid misinterpretations.
They proposed the ministry organize a meeting to collect comments from auto importing and assembly enterprises before the new calculation method is adopted.
