No problem for auto market: industry minister

01-Nov-2018 Intellasia | The Saigon Times | 6:26 AM Print This Post

Deputies of the National Assembly (NA) at the question-and-answer session today, October 30 voiced concerns over the local automobile market being heavily affected by the import tax cut while automobile prices either remain unchanged or have risen. However, minister of Industry and Trade Tran Tuan Anh assured them that the automobile market is not facing any major problems.

Deputy Cao Dinh Thuong from Phu Tho Province said statistics from the general Department of Vietnam Customs show that since the beginning of the year, 32,000 automobiles had been imported into Vietnam, with 90 percent of them coming from Asean countries. Despite the drop from 30 percent tariffs to zero tariffs, Asean automobile prices either remain unchanged or have inched up.

Thuong said that if the situation persisted, the State would not ramp up tax revenue and customers would suffer losses, adding that only enterprises would benefit. He demanded the minister of Industry and Trade address the uncertainty of the situation.

At the session, Tran Tuan Anh explained that as Vietnam further integrates into the global economy, a series of free trade agreements have been signed with tax obstacles to be eliminated.

In particular, a free trade agreement signed with the Asean stipulates that from January 1, 2018, taxes on automobiles are to be slashed to zero. Besides this, a score of free trade agreements such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the European Union-Vietnam Free Trade Agreement contain the same provisions to cut customs duties.

The representative of the Ministry of Industry and Trade noted Vietnam had weighed all options and made detailed calculations in its negotiations to ensure the interests of the State, customers and enterprises and to meet rising demand in the local automobile market.

Anh pointed out that in addition to the automobile import tax, other sources could help raise the State budget, including tax collection from manufacturing and tariffs on automobile trading firms, which would have no impact on the State budget.

The minister said that statistics indicate that imports of automobiles from the Asean into Vietnam have yet to surge strongly compared with the total imports since the start of the year. The local market reportedly consumes 500,000 automobiles, with some 200,000 units imported each year. Anh said there were no major difficulties at all.

Dissatisfied with the minister’s explanation, Cao Dinh Thuong countered that as regulated, the import tax on automobiles from the Asean had fallen from 30 percent to zero, so it was understandable that automobile prices would drop by 30%. Yet, the price is almost unchanged, Thuong stated, insisting that the minister had yet to clarify whether the State would suffer a loss in tax revenue from automobile imports, whether customers would be affected and whether enterprises were subject to any taxes.

NA Chairwoman Nguyen Thi Kim Ngan proposed the Ministry of Industry and Trade answer the questions in writing.

Report on State-owned firms’ bad debts is incomplete

At the NA meeting, the Q&A session was for the first time held as an open discussion, differing from previous Q&A sessions that focused on particular groups of issues, collecting deputies’ opinions and submitting them to the NA Standing Committee.

As the session was organised under the new format, deputy prime minister Truong Hoa Binh at the start of the session reported the execution of the NA’s resolutions on special supervision and their performance from the beginning of the NA’s tenure to its fourth sitting.

Le Nhu Tien, a former NA deputy, said the new format of the Q&A session was effective as the NA would not miss any topics.

A report from the Committee on Ethnic Minority Affairs and the committees of the NA on an inspection into the execution of the NA’s resolutions, presented by NA general Secretary Nguyen Hanh Phuc, emphasized the difficulties in restructuring credit organisations and handling bad debts.

The report indicated that the government had yet to report the results on bad debts related to State-owned enterprises, bad debts in programmes and projects approved by the government and prime minister, government-guaranteed debts and debts for construction sourced from the State budget.

The government had earlier issued a report only showing that it had established a steering committee for restructuring the system of credit organisations and deployed measures to settle bad debts.


Category: Economy, Vietnam

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