The Ministry of Finance is seeking comments on the Government's draft decree on registration fees for domestically produced and assembled cars.

According to the draft, from August 1, 2024 to January 31, 2025, the registration fee collection rate is equal to 50% of the collection rate prescribed in Decree No. 10/2022 of the Government regulating registration fees and current resolutions and decisions of the People's Council/People's Committee of provinces and centrally run cities on local registration fee collection rates and amendments, supplements and replacements (if any).

From February 1, 2025 onwards, the registration fee collection rate will continue to be implemented according to the previous regulations.

According to the Ministry of Finance, according to the assessment of the socio-economic situation, the average core inflation in the first 5 months of 2024 increased by 2.78% compared to the same period in 2023, lower than the average CPI (up 4.03%). Domestic gold prices are in line with world gold prices.

car assembly 1 2441.jpg
The Ministry of Finance has proposed a 50% reduction in registration fees for domestically produced and assembled cars. Photo: Nguyen Hue

Increasing geopolitical risks in the Middle East along with the reserve needs of central banks and investors are the main reasons for the continuous increase in world gold prices.

Domestically, the gold price index in May 2024 increased by 3.81% over the previous month; increased by 21.47% over December 2023; increased by 32.18% over the same period last year; the average for the first 5 months of 2024 increased by 22.95%.

With inflationary pressure, exchange rates, and high gold prices... there has been a significant impact on consumer psychology, leading to tightening spending on high-value items, including cars.

Faced with the reality of a sharp decline in car consumption, car manufacturing and assembly enterprises have launched many incentive programs to support and encourage consumers to buy cars.

The continued reduction of 50% of registration fees for domestically produced and assembled cars has a positive impact on consumers as a financial support solution and consumption incentive.

The Ministry of Finance calculates that a 50% reduction in registration fees for domestically produced and assembled cars could reduce the State budget revenue by an average of VND867 billion/month (equivalent to the reduction according to Decree No. 41 of 2023). In addition, it could also affect the State budget revenue balance of localities.

A 50% reduction in registration fees for domestically produced and assembled cars is likely to increase the number of cars sold and registered, so revenue from registration fees, special consumption tax, and value added tax may increase.

However, actual revenue from special consumption tax and value-added tax is only concentrated in 8 localities where there are domestic automobile manufacturing and assembly companies, while other localities have reduced local budget revenue from this policy.

Fees for new registration certificates and license plates for pickup trucks have increased 40 times . According to Circular 60/2023/TT-BTC, from October 22, the fee for new registration certificates and license plates for pickup trucks in Region I (Hanoi and Ho Chi Minh City) is 20 million VND, an increase of 40 times.