Proposal to extend excise tax to support domestic car production

The Ministry of Finance has just completed a draft Decree extending the deadline for paying excise tax for domestically manufactured or assembled cars.

The Ministry of Finance proposes to extend the excise tax to support domestic car production.

Regarding the extension time, according to the provisions of Article 44 of the Law on Tax Administration No. 38/2019/QH14 and Article 8 of Decree No. 126/2020/ND-CP , business establishments shall declare excise tax on a monthly basis. and the deadline for tax payment is the 20th of the following month.

In order that the extension of the deadline for paying excise tax in 2022 for domestically manufactured or assembled cars does not lead to an adjustment of the state budget revenue estimate and is consistent with the current time, the Ministry of Finance submits The Government plans to: Extend the tax payment deadline for the payable excise tax amount arising in the tax period of June, July, August and September 2022 for automobiles manufactured or assembled in Vietnam. country.

The extension period is from the end of the time limit for paying special excise tax in accordance with the law on tax administration, specifically as follows: The time limit for paying special excise tax payable arising of the monthly tax period June 2022, July 2022, August 2022, September 2022 no later than November 20, 2022.

The extension applies to the case of additional declaration of tax declaration dossiers of the extended tax period and to cases where the enterprise has branches and affiliated units engaged in manufacturing or assembling activities. automobiles make separate excise tax declarations with the tax authorities directly managing them.

Regarding the order and procedures for requesting an extension, taxpayers eligible for extension shall send a written request for extension of the excise tax payment deadline (by electronic means; send a paper copy directly to the tax authority. or send by post) to the tax authority directly managing once for all the extended periods together with the time of submission of excise tax declaration dossiers in accordance with the law on tax administration.

If the application for extension of the excise tax payment deadline is not submitted at the same time as the submission of the excise tax return, the deadline for submission of the application for extension of the excise tax payment deadline is November 20, 2022.

If during the extension, the tax authority determines that the taxpayer is not eligible for the extension, or after the extension period expires, the tax authority discovers that the taxpayer is not eligible for the extension. The tax authority shall notify the taxpayer of the termination of the extension and the taxpayer must pay the full amount of tax and late payment interest during the extension period into the state budget.

During the extended period of excise tax payment, the tax authority does not charge late payment interest for the extended excise tax amount. In case, the tax authority has already charged the late payment interest for the excise tax declarations that are extended according to the provisions of this Decree, the tax authority shall make the adjustment without charging late payment interest. Special Consumption.

Because this is an urgent solution that needs to be issued immediately to promptly support domestic automobile manufacturers and assemblers, the Ministry of Finance has submitted to the Government for permission the Decree to take effect from the date of signing.

The decree was implemented in a short time, not a decree to supplement, amend or replace the current decree, so to ensure rigor, the Ministry of Finance submitted to the Government the regulation: "After a period of extended under this Decree, the payment of excise tax on domestically manufactured or assembled automobiles shall comply with current regulations.

The total amount of the extension is expected to reach 11.4 trillion VND

Assessing the impact on state budget revenue, according to the Ministry of Finance, based on the provisions of Article 8 of Law No. 03/2022/QH15 on adjustment and reduction of excise tax rates to 3%, 2% , 2%, 1% for domestically manufactured and assembled electric cars with 9 seats or less, from 10 to under 16 seats, designed to carry both people and goods, from 16 to under 25 seats and It is expected that the consumption of electric vehicles will increase, replacing the corresponding gasoline-powered car.

Based on the production and business situation and payment of special consumption tax for the whole year of domestic automobile manufacturers and assemblers in recent years as follows: In 2019 it was 29,358 billion VND (average 2,450 billion VND/ month); in 2020 is 31,765 billion VND (average 2,650 billion VND/month) and in 2021 it is 33,900 billion VND (average 2,800 billion VND/month). Thus, the average amount of tax paid to the state budget ranges from VND 2,450 billion to VND 2,800 billion/month.

With the assumption of implementing Law No. 03/2022/QH15 , due to the low tax rate of excise tax on battery electric vehicles, it is sufficient to increase the consumption demand for electric vehicles, thereby a large amount of demand for electric vehicles. Gasoline cars will be replaced by electric cars, which is expected to reduce budget revenue by about 2,000-3,000 billion VND, an average of 170-250 billion VND per month.

The total amount of excise tax that is expected to arise and is extended for 4 periods (from the June tax period to the September tax period) is about VND 9,300-11,400 billion.

In fact, the 4th wave of COVID-19 outbreaks in many provinces and cities in 2021 has inhibited the recovery of the auto market. Following the anti-epidemic directives of the local authorities, many auto dealers of Toyota, Ford, Mitsubishi... in Hanoi and Ho Chi Minh City. Ho Chi Minh City - one of the largest auto markets in the country had to suspend operations and almost fell into a "freeze", especially in the period from June to September 2021.

Not only sales, but the car factories of some automakers are also affected by the lack of chips and assembled components due to the disruption of the global supply chain. There has never been a year where the Vietnamese auto market has experienced as many turbulence as in 2021, domestic automobile production and assembly is an area affected by the COVID-19 pandemic that requires support from the State.

The extension of payment of excise tax on domestically manufactured and assembled cars has been implemented in 2020 and 2021 according to the provisions of Decree No. 109/2020/ND-CP and Decree No. 104/ 2021/ND-CP .

In order to promptly support domestic automobile manufacturers and assemblers according to Resolution No. 11/NQ-CP , the Ministry of Finance has completed the draft and submitted to the Government for promulgation a Decree extending the deadline for paying consumption tax. especially for domestically manufactured and assembled automobiles in 2022 according to the shortened order and procedures.

Source: Cổng thông tin điện tử Chính phủ

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