Reduce environmental protection tax by more than 42,000 billion VND to support gasoline prices

Similar to the reduction in environmental protection tax (EPT) on gasoline, oil, and grease in the 2022-2023 period, continuing to maintain this tax rate for 2024 will continue to contribute to reducing the increase in domestic retail gasoline prices.

The Ministry of Finance has just completed the draft Resolution on environmental protection tax rates for gasoline, oil, and grease in 2024 to collect opinions from ministries, branches, and localities before submitting it to the Government.

Accordingly, the environmental protection tax applied to gasoline, excluding ethanol, will be 2,000 VND/liter; the environmental protection tax on jet fuel, diesel, fuel oil, and lubricants will be 1,000 VND/liter; grease will be 1,000 VND/kg; and kerosene will be 600 VND/liter.

From January 1, 2025, the environmental protection tax rate on gasoline, oil, and grease will return to the old rate, implemented according to Resolution No. 579/2018/UBTVQH14 of the Standing Committee of the National Assembly (gasoline, excluding ethanol, is VND 4,000/liter; jet fuel is VND 3,000/liter; diesel, fuel oil, and grease are VND 2,000/liter; kerosene is VND 1,000/liter; grease is VND 2,000/kg).

A petrol and oil store in Hanoi. Photo: Tran Viet/VNA

According to the Ministry of Finance, the environmental protection tax rate on gasoline, oil, and grease in 2024 will contribute to directly reducing people's costs in gasoline consumption and reducing indirect costs from the consumption of other products; at the same time, helping businesses increase their resilience and expand production and business, especially in the fields of transportation, shipping, fishing, gas services, etc.

With the expected consumption of gasoline, oil, and grease in 2024 being equivalent to the expected consumption of gasoline, oil, and grease in 2023 and with the environmental protection tax (EPT) rate on gasoline, oil, and grease as proposed above, the expected reduction in EPT revenue if implemented according to Resolution No. 579/2018/UBTVQH14 of the National Assembly Standing Committee is about VND 38,929 billion and the total State budget revenue (including the reduction in value added tax - VAT) is about VND 42,822 billion.

In the coming time, the Ministry of Finance will continue to closely monitor the developments in world oil prices and in case oil price fluctuations affect the implementation of economic development goals, the Ministry of Finance will coordinate with relevant ministries and branches to study, propose and submit to the Government a report to the National Assembly Standing Committee on a plan to adjust the environmental protection tax rate in accordance with the actual situation.

Environmental protection tax is one of the factors that make up the domestic retail price of gasoline, so adjusting the environmental protection tax rate will directly affect the domestic retail price of gasoline.

By continuing to apply the environmental protection tax rate on gasoline, oil, and grease in 2024 as the environmental protection tax rate implemented in 2023 and assuming that other factors constituting the base price of gasoline and oil remain unchanged compared to the most recent management period, the retail price of gasoline, oil, and grease will decrease compared to the implementation of the tax rate prescribed in Resolution No. 579/2018/UBTVQH14 as follows:

For gasoline (except ethanol), the environmental protection tax rate is reduced by VND 2,000/liter, thereby reducing the retail price of gasoline (including the VAT reduction) by VND 2,200/liter.

For aviation fuel, the environmental protection tax rate is reduced by VND 2,000/liter, thereby reducing the retail price of aviation fuel (including the reduced value-added tax - VAT) by VND 2,200/liter. For diesel, fuel oil, and lubricants: the environmental protection tax rate is reduced by VND 1,000/liter, thereby reducing the retail price of diesel, fuel oil, and lubricants (including the reduced VAT) by VND 1,100/liter.

For grease, the environmental protection tax rate is reduced by VND 1,000/kg, thereby reducing the retail price of grease (including the VAT reduction) by VND 1,100/kg. For kerosene: the environmental protection tax rate is reduced by VND 400/liter, thereby reducing the retail price of kerosene (including the VAT reduction) by VND 440/liter.

According to the Ministry of Finance, because the domestic retail price of gasoline depends mainly on the world price of finished gasoline, the specific reduction in the domestic retail price of gasoline will depend on the fluctuation of the world price of finished gasoline. The adjustment of the environmental protection tax rate for gasoline, oil, and grease as proposed above ensures compliance with the principles regulating specific tax rates for each type of goods subject to environmental protection tax, according to Article 8 of the Law on Environmental Protection Tax.

According to VNA/Tin Tuc Newspaper

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