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Finding solutions to stabilize petrol prices

10:45 | 25/06/2022

VCN – The Ministry of Finance on the afternoon of June 22 held a meeting with the Vietnam Petroleum Association to discuss proposals related to petroleum business.

Businesses continue to struggle with petrol prices Businesses continue to struggle with petrol prices
If there was a huge change on petrol prices, it would necessary to temporary halt of deductions from fund to stabilize petrol price If there was a huge change on petrol prices, it would necessary to temporary halt of deductions from fund to stabilize petrol price
An increase in taxes will not necessarily lead to higher petrol prices An increase in taxes will not necessarily lead to higher petrol prices
Minister of Finance Ho Duc Phoc speak at the meeting. Photo: TL.
Minister of Finance Ho Duc Phoc speak at the meeting. Photo: TL.

Speaking at the meeting, Chairman of the Vietnam Petroleum Association Bui Ngoc Bao said the price of gasoline has recently increased dramatically. As a result, the Ministry of Finance has introduced many solutions to stabilize prices and improve the price increase situation.

According to Mr. Bui Bao Ngoc, to stabilize gasoline prices, the Vietnam Petroleum Association proposed the Ministry of Finance many contents related to petroleum business activities such as: proposals on reducing 10% or 8% MFN tax on gasoline for a term; reducing value-added tax, special consumption tax due to increase in gasoline prices; reviewing regulations on contractor tax with bonded warehouses and regulations on application of e-invoices to petroleum trading activities.

Deputy Minister Vu Thi Mai said regarding the proposal on tax reduction on gasoline, the Ministry of Finance will continue to monitor the price movements. If prices continue to increase, it will report to the Government to issue a resolution on tax reduction and, for the immediate future, the Ministry of Finance will continue to propose tax reduction on green tax.

Regarding contractor tax for bonded warehouses, Deputy Minister Vu Thi Mai said that currently, according to regulations, foreign businesses that are not present in Vietnam but have operations in Vietnam must pay value added tax and corporate income tax, so when doing business in bonded warehouses and selling goods in Vietnam, they must pay tax.

Regarding e-invoices for petroleum trading activities, the Deputy Minister proposed the General Department of Taxation urgently guide tax departments and petrol and wholesalers in the implementation of e-invoices. Regarding the proposal on reducing MFN tax on gasoline, the Ministry of Finance noted and will study to offer an appropriate reduction.

Concluding the meeting, Minister of Finance Ho Duc Phoc affirmed that the Ministry of Finance noted the comments and will review, if necessary, the ministry will report to the Government.

According to the Minister, the rising petrol price has affected all industries and the production and business efficiency of the economy. Therefore, it is necessary to offer solutions to stabilize gasoline prices, in which focus on three contents.

First, it is necessary to find an abundant and cheap supply of petrol.

Secondly, tax reduction will affect fiscal policy but will stimulate demand and economic development. Regarding the green tax, it reduces by 2,000 VND per liter and the Ministry of Finance is proposing to reduce another 1,000 VND/liter to 3,000 VND/liter. As for the reduction on excise tax, it must be submitted to the National Assembly.

Third, Vietnam must prevent smuggling and reduce illegal transportation of petrol and oil because many neighboring countries of Vietnam have a much cheaper petrol price than our country. We must have solutions to prevent this problem.

Regulating petrol prices to ensure publicity and transparency Regulating petrol prices to ensure publicity and transparency

Minister Ho Duc Phoc affirmed that the Ministry of Finance will report to the Government on these problems to offer solutions to promote economic development and stabilize people's lives.

By Thuy Linh/ Huyen Trang