To expect to continue reducing environmental protection tax on gasoline by 50% by 2024 in Vietnam

To expect to continue reducing environmental protection tax on gasoline by 50% by 2024 in Vietnam (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. What is environmental protection tax?

According to Clause 1, Article 2 of the Law on Environmental Protection Tax 2010, environmental protection tax means indirect-collected tax, collected on products and goods (hereafter referred to as goods) when used to cause negative environmental impacts.

2. To expect to continue reducing environmental protection tax on gasoline by 50% by 2024 in Vietnam

In Article 1 of the Draft Resolution of the National Assembly Standing Committee on environmental protection tax rates, the Ministry of Finance still proposes to reduce environmental protection taxes on gasoline, oil, and lubricants until December 31, 2024. is a 50% reduction compared to the currently applicable tax rate. As follows:

It can be seen that this proposed 50% reduction is being applied similarly to 2023 in Resolution 30/2022/UBTVQH15. The expected time to apply the reduced environmental protection tax rate is from January 1, 2024, to December 31, 2024.

After this date, that is, January 1, 2025, the environmental protection tax rate on gasoline and oil will return to normal according to Clause 1 of Article 1 of Resolution 579/2018/UBTVQH14.

3. Environmental protection taxable subject in Vietnam

Taxable subject

- Gasoline, oil, grease, including:

+ Gasoline, except ethanol;

+ aircraft fuel;

+ diesel oil;

+ Petroleum;

+ Fuel oil;

+ lubricants;

+ Grease.

- Coal, including:

+ Lignite;

+ Anthracite Coal (anthracite);

+ Fat coal;

+ Other coal.

- Hydrogen-chlorofluorocarbon liquid (HCFC).

- Taxable-plastic bag.

- Herbicide which is restricted from use.

- Pesticide which is restricted from use.

- Forest product preservative which is restricted from use.

- Warehouse disinfectant which is restricted from use.

- When it is necessary to supplement other taxable objects as per period, the National Assembly Standing Committee shall consider and regulate.

(Article 3 of the Law on Environmental Protection Tax 2010)

4. Un-taxable object in Vietnam

The following subjects are not subject to environmental protection tax as follows:

- Goods is not specified in Article 3 of the Law on Environmental Protection Tax 2010 shall not be subject to environmental tax.

- Goods provided for in Article 3 of the Law on Environmental Protection Tax 2010 shall not be subject to environmental tax in the following cases:

+ Goods transported in transit  or transshipped through the border gate, Vietnam border in accordance with the law, including the transportation of goods from exporting countries to importing countries through the border gate of Vietnam but it is not made import & export procedures into and out of Vietnam;

Transit goods through the border gate, the border of Vietnam on the basis of agreements signed between the Government of Vietnam and a foreign government or an agreement between agencies, representative authorized under the provisions of law by government of Vietnam and foreign governments;

+ Goods temporarily imported for re-export within the time limit prescribed by law;

+ Goods directly exported by production facilities or entrusted for the export business to export, except for organizations, households and individuals to purchase goods which environmental protection taxable subject to export.

(Article 4 of the Law on Environmental Protection Tax 2010)

5. Who are environmental protection taxpayers in Vietnam?

Pursuant to Article 5 of the Law on Environmental Protection Tax 2010, environmental protection taxpayers are stipulated as follows:

- Environmental protection taxpayer is organizations, households and individuals producing, importing goods under taxable subject provided for in Article 3 of the Law on Environmental Protection Tax 2010.

- Environmental protection taxpayer in some specific cases shall be provided for as follows:

+ in case of goods importing commission, the person who entrusted importing goods shall be taxpayer;

+ In cases where organizations, households and individuals act procurement hub of coal to develop small, retail but they can not produce the documents proving that goods have been paying environmental protection tax, the organizations, households individuals act as procurement hub shall be taxpayer.

Nguyen Ngoc Que Anh

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