Vietnam to Hike Taxes on Imported Cars

Import duty on new passenger cars will increase to 70% from 60% while used autos would be subject to an average 10% rise.

In a move that state media said would curb traffic congestion, Vietnam will raise taxes on imported cars by 10%. Import duty on new passenger cars will increase to 70% from 60% while used autos would be subject to an average 10% rise, according to a finance ministry decision.

Vietnam, a country of 86 million people, is facing challenges from a rapid rise in car ownership which has accompanied the booming economy, with traffic choking the streets of major cities such as Hanoi and Ho Chi Minh City.

Vietnam had cut taxes on imported cars three times since January 2007, when the country joined the World Trade Organization, from 90% to the current level of 60%. With these decreased duty rates, the country imported 30,330 vehicles last year, nearly twice as many as in 2006, with a total value of $579 million, according to official statistics.

Copyright Agence France-Presse, 2008

TAGS: Regulations
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