Vietnam to cut car import duties in 2012

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Vietnam will cut the import duty on cars next year, with the tax on most models lowered by three to five percentage points, according to a new Finance Ministry proposal.

Cars of less than ten seats will subject to a new tax range of 68-78 percent on January 1, 2012, compared to the current 72-83 percent, news website VnExpress reported, citing the proposal.

The tax on small trucks of five tons or less will also be slashed to 65 percent, from 68 percent. The tarriffs on large trucks remain unchanged under the proposal.

The new tax rates will apply to cars imported from member countries of the World Trade Organization and the regional Southeast Asian bloc ASEAN.

Vietnam's total car imports fell around 10 percent in September from August to 3,000 units, VnExpress reported, citing customs statistics.

The number of used cars imported into Vietnam, however, doubled last month's figure, hitting 405 units. Most of the imported secondhand cars are small ones with engines of less than one liter.

VnExpress said the Ministry of Industry and Trade plans to keep the import duty on used cars unchanged. It means cars with engines of 1.5 liters or more will continue to face to the same tax rates as new cars, and then an additional US$5,000 to $15,000 tax.

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